DISCUSSION QUESTION
Throughout the New Shoes Simulation you will have to evaluate your previous decisions as well as other Market data and information in order to make an informed decision for the current period.
The break even analysis is a tool that can assist in setting the price for your athletic shoe during the various decision periods.
Based on the market data and information presented in the simulation determine the break even analysis for your New Shoes company and the correlation to your shoe pricing strategy.
Keep in mind that to calculate the break even analysis you can use the following formula:
Break Even Price=variable cost (the unit cost of the product) + fixed expenses (marketing expenses and allocated product development expenses) /projected units.
Having calculated the Break Even Analysis what will you have to price your shoes in order to reach your target run? In addition, provide an assessment of other elements that should be considered in addition to the break even analysis to the determine the price of your shoes.
Research and find an organization that has been challenged with setting prices for their products or services and share how they addressed the issues.