Salad Case Study Solution

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Costs will influence prices because they affect supply as, the lower the cost, the more a firm is able to supply. The cost to produce and offer our salads to the public will be one of the main considerations on how our salads will be priced. Costs to produce will include rental for the kitchen, hiring chefs, and the ingredients to make the salad. There will also be costs incurred for delivery, marketing of our salads, and rental of places for our vending machines. The price set will need to cover the costs and at the same time include a fair return for our business’s risks and efforts. Competitors Competitors influence prices through their actions such as affecting demand and forcing rivals to lower their prices. Our competitors are those…show more content…
The reason doing so is that if our products are similar, we will have to price close to the competitor or lose sales. Conversely, if our products are inferior, we will not be able to charge as much as the competitor. For Gusto Green, it will be relatively easy to enter into the industry as by selling the salads through vending machines in convenient locations where there is little or no competitors, there will be lesser competition. Not to mention that consumers will more likely purchase from our Salad Box. Furthermore, we are also able to differentiate ourselves by being convenient. The marketing objective for Gusto Green will be maximizing market share as it will be easy for us to enter into the industry and being a start-up business, it is important to attract customers and gain market share and acceptance. Thus, we will be using market penetration to price our salads at a lower price compared to salad bars. This will enlarge our consumer base and save unit cost from a larger sales volume. Customers Customers will influence price through the effect of demand based on factors such as the quality of the product and…show more content…
Additionally, with more health conscious Singaporeans, the demand for healthy food is likely to increase. This also means that customers will be willing to pay more to eat healthy foods. Although customers are willing to pay, we will also need to take into consideration the price sensitivity to our salads as it affects demand. Being in the F&B industry, if the price for our salads are too high, consumers can choose to select alternatives such as eating from food courts. Therefore, our salads are price sensitive which also means that a low price will produce more
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