Analysis of Pricing Strategies for Small Businesses: A Report

This report analyzes the significance of pricing strategies for small businesses, particularly in the context of a restaurant. The report emphasizes the importance of understanding customer value and competitive pricing to achieve profitability. It discusses how to implement effective pricing strategies. The report highlights the need for businesses to consider factors such as cost, market demand, and customer preferences when setting prices. The report also includes suggestions for the restaurant, like offering a variety of pricing options, including the use of a tiered pricing model, and adapting to market changes to maximize profits. It also acknowledges the importance of digital technology in small business management. The report concludes with a focus on the potential for the business to increase its profitability through smart pricing strategies.

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Running head: PRICING STRATEGY
Pricing strategy
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PRICING STRATEGY 2
Pricing Strategy
Frank’s All American BarBeQue is a small business that is adapting to the use of Ecommerce
which is a technological change that has risen in the economy (Cadden & Lueder, 2012). Below
are some pricing strategies that they should implement on the two types of meals they are
offering, that is, their variety of standard meals and the three-course meals served to their
customers.
Frank’s All American BarBeQue should maintain a balance on their high cost meals that include
the main course dish, two side dishes and dessert as well as the low cost meals that are a variety
of standard meals. This is because there are different classes of customers that will want to buy
or order (online) a certain kind of meal depending on their preference (Hooge et al., 2017).
They should also consider incorporating the triple pricing strategy whereby the menu is
categorized into three; good, better and best. The good item is the least expensive as it mostly
involves a variety of snacks and fast foods. The better item, which is mid-priced, is quite often
the best-selling as it accommodates both the in-restaurant and take out customers. The best item
accommodates a greater percentage of the in-restaurant customers. It entails expensive quality
three-course dishes, desserts and wines.
For maximum profitability, a restaurant’s menu should be adaptable in such a way that it is
considerate to price fluctuations in the market. It is advisable that the prices are set fairly higher
so as to cover for bad seasons in times of fluctuations. This ensures your restaurant never incurs
a loss even during bad times when profits are low.

PRICING STRATEGY 3
References
Cadden, D. & Lueder, , 2012. Small Business Management in the 21st Century. Arlington,
Virginia : Saylor Academy, Minneapolis.
Hooge, I.E.d. et al., 2017. This apple is too ugly for me!: Consumer preferences for suboptimal
food products in the supermarket and at home. Food Quality and Preference, pp.Pages 80-92.