Automated Minimum Product Price Recommender Algorithm for Retailers

This report presents an automated pricing algorithm designed to determine the Minimum Recommended Selling Price (MRSP) for retailers. The study emphasizes the importance of a robust business model, particularly in calculating costs and revenues accurately. The methodology involves a two-stage process: a survey to identify business expenses and a technical calculation of these expenses to determine the MRSP. The algorithm aims to help retailers avoid losses and increase profitability by setting a price floor. The paper highlights the limitations of the algorithm, such as its inability to calculate the MRSP for in-house created products, focusing instead on products bought from wholesalers. The research contributes to filling the gap in automated price recommendations and assisting businesses in budget forecasting. The report also reviews existing business models, revenue models, and associated costs, including operating, sales, and delivery costs. It references various methods for maximizing retailer profits, such as bi-level programming and dynamic pricing, while also acknowledging the current gaps in research related to comprehensive business objectives.