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Pricing can be fixed in at least 3 different ways, as follows.
1.Fixed Pricing: With fixed pricing, you would assign a price to your menu item, do this for each menu item and charge the customer on a “per-plate” basis or platter basis. Check if this model suits your catering assignment. Needless to say, in this case, profits would be determined also on a platter basis.
2.Tiered Pricing: This is very similar to fixed pricing but you can pass on the benefit of numbers to your customer. Essentially, more the expected turnout, lower will be the price of each item. You can have 3-4 such tiers with the minimum number of guests deciding each tier price. For example, for greater than 50 guests you could charge $20 for an item; for greater than 100 guests you could charge $18 for the same item and so on. This can be a very cost-effective model provided there is a great turnout of guests expected.
3.Customized Pricing: With the earlier methods, the customer knows upfront what your charges typically would be; however, with custom pricing, you have the freedom to decide the menu and pricing after the customer briefs you about all the details of the event. However, it is still beneficial to have a pricing guide ready for reference even for custom pricing. It will enable you to approximate the estimates better.
The above guidelines for determining the pricing for a menu are not stringent. It is just information about how pricing for a catering job is done. You will in fact need to be flexible if you’re serious about being in the business for a long time. There are many other factors that influence pricing such as the type of customer, your immediate competition in the same area and how established you are in the business. If you’re well-known for the quality of food, customers may not be very rigid about lowering your prices. On the other hand, if you have your close competitors quoting below your rates, you may have to negotiate harder so as not to lose the deal. You may have to provide additional “frills” to add value and differentiate your catering service from that of your rivals. If you’re very new to the business, you may well have to incur losses in your first few assignments just to prove your worth and establish your presence.

Thus, the ultimate profitable pricing strategy is a mix of several factors. Keep an open mind and be optimistic about the outcome. Once you know your market, your client base, etc., you will gradually work out the pricing strategy that is optimum for your catering business. Take each assignment as a challenge and be willing to learn from your mistakes as the catering business is certainly not for the faint-hearted. Read the rest of this entry »

Does penetration pricing work? It definitely does, and it succeeds in taking your rivals completely by surprise, giving them no time to recover from your onslaught. If your sales pick up, thanks to word-of-mouth publicity, nothing else could be better.
1.Penetration price strategy is implemented with the sole intention of spreading your presence in the market. It is an appropriate marketing tool which creates a loyalty base for your product.
2.Deliberate underpricing is suitable for average quality products and new products under automobiles, computer accessories or cosmetics. It also works well for commodities with a shorter shelf life, such as consumable items. The distributors and retailers have reasons to cheer as penetration pricing effectively accelerates the turnover.
3.The low cost manages to generate an interest, especially among those looking to snag a bargain. After this, it is up to the product to impress the consumer. If it gets an approval from the consumer, the company can think of gradually increasing the cost and rake in actual profits.
4.It results in startling your competitors, more so if the product segment is overflowing with options for the consumer. If a rival product is looking to enter the market, your penetration pricing strategy will arrest it by grabbing a lion’s share in consumer preference. It puts your product in a vantage position to establish a firm hold in its arena.
5.There are also instances where companies have managed to pocket some profit despite using this strategy. The trick used here works on products that need add-ons to function. Cheap razors that need expensive cartridges or low cost printers, which function on outrageous refills illustrate this point.
6.When a product is placed in the market at an attractive “introductory price”, consumers expect a price rise in the near future, and sometimes decide to stock up on it, thus fulfilling the purpose of penetrative pricing. Mind you, this is only possible in cases of products launched by recognized brands. Read the rest of this entry »

Did you leave your previous job on an amicable note? If not, you may wish to reconsider the whole operation of getting your old job back, your current miserable status not withstanding. Assuming that you parted on good terms, getting back to your previous firm will be a notch easier. Let’s get started on “mission reapplication”.

Step 1: Making Contact
Having been a part of the organization, you are at an advantage. Contact your old colleagues to get an insider’s view on the hiring scenario. If everything appears to your liking, waste no time in establishing contact with the person in charge of hiring. Decide on the most appropriate means of bridging contact, it could be a phone call, an e-mail or a meeting.

Step 2: Update Your Resume
Do not undermine the importance of an updated resume even if you’ve worked for the company before. Your qualifications and abilities may be known to them, but you need to tell them what you’ve gained in the period you were away. It doesn’t matter if the nature of your work was completely different, a good resume will prove how it has helped you enhance your capabilities.

Step 3: Expect Scrutiny
You may be put through a full-fledged interview, in case of a management overhaul. Refrain from harping on your past achievements, focus instead on the current situation. The person in charge will already have an idea of your contributions. Shift to the present and stress on how you see yourself benefiting the organization now.

Step 4: Be Reassuring
You may not have left your previous firm in a lurch the last time you left, but expect to do a lot of reassuring this time around. Your boss is bound to put you on his suspicion radar, at least throughout your probation period. You must not fuel their insecurity by being lax with your tasks. Be on top of your job and make your company feel happy about rehiring you. Read the rest of this entry »

Offer a Win-Win Deal
While you may be tempted to reap more than you sow, attracting sponsorships requires a deal that is equally profitable for both parties. Money still doesn’t grow on trees, else you would have plenty of your own. Alas, they don’t and that is why you need sponsors! You need to provide them value for money. Tell your sponsors how the business transaction will help them garner more consumer exposure in the market.

Attract the Right Sponsors
If you are constantly being shown the door by all the sponsors you have approached so far, think again. Maybe you are approaching those sponsors who have nothing to do with absolutely anything that your event is about. All companies want to reach the maximum target market they can through your event. If you are trying to allure the wrong sponsors, you are not going to come back with a wad of cash in your hand. They will not even bother to tell you why you did not manage to get any sponsorship from them. If you are organizing a sophisticated business event, such as a trade show, you may try high-end automobile companies, business hotels, airlines and other industries that cater to business professionals and mainly concentrate on them as their target customers.

It’s in the Details
Present a clear and fair picture to your sponsors. You need to mention every detail regarding the event, expected outcome and what’s in it for the sponsors if they invest. Doing it right will ensure that you build a reputation for your company too. This is really advantageous in the long run and will make it easier for you, in future, to attract sponsorships. Being certain of your plans will help the sponsor show more faith in you. Here is a tip for you, draft a SWOT analysis for assistance for your sponsors. Also, exhibiting your USP will work in your favor. You must include all these aspects in your sponsorship proposal template.

Presentation Skills
Do remember that it is all about your brand image. It is another thing to sell a product that has not even been produced in the present. Your event is to take place at a future date. What you need is to be able to convince your prospective sponsors that it will be a hit with the attendees, and sponsoring it will be a smart investment for them with long-term benefits. To ensure this, you need good presentation skills to secure the confidence of your sponsors. Word of advice, never lose faith in the success of your event and always exude confidence. Read the rest of this entry »

Why do accountants go through the exercise of crunching tons of numbers to compute the value of assets? Here are reasons why all that effort is necessary.

To Ensure the Right Price is Paid
When a business or any individual is considering investment in a particular asset, its valuation is necessary to ensure that the right price is paid. That is the most fundamental reason why asset valuation is an important activity in accounting.

For Taxes
Taxation is one of the primary reasons why valuation of assets becomes an essential exercise. There is property and income tax to be paid, which requires the valuation of real estate property, as well as other assets. This makes accurate calculation of tax dues possible.

To Analyze Investment Potential
If you are investing in a real estate scheme, a business or any other entity, with the purpose of asset creation, it’s imperative that valuation of the entity be undertaken. It helps you in gauging the future earning potential of the asset.

For Financial Reports and Audits
For public listed companies or businesses that fall in regulated sectors, it’s mandatory that they provide financial reports and subject themselves to financial audit. This reporting and expected transparency from businesses necessitates that asset valuation be carried out. Investors can then decide the worth of a company, from the valuation of its assets.

For Mergers and Acquisitions
When two companies are thinking of merging together or an acquisition is being planned, asset valuation is absolutely essential. This helps the people involved know the worth of any company involved in such a financial takeover or merger. It helps in ‘sizing up’ a business.

Loan Applications
When a business or any individual applies for a big loan, banks demand collateral. Whatever assets pledged as collateral, need to be valued. It forms an important detail, as the bank grants a loan, against the value of the security you offer. Read the rest of this entry »