Evaluating determinants of pricing objectives (The case of selected breweries in Ethiopia)
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Date
2018-05-14
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Addis Ababa University
Abstract
A total of 345 questionnaires were distributed to employees of four conveniently selected brewery companies in Addis Ababa Ethiopia with 268 questionnaires responded by a total of 161 males and 107 females involved. 41 males and 37 females were from BGI Ethiopia, 38 males and 23 females were from Dashen, 36 males and 23 females were from Diageo Meta and 44 males and 26 female respondents participated from Heineken. Most of the respondents (32.5%) have job experience of above five years. The general purpose of the study was to evaluate cost, product quality, demand and competition as determinants of pricing objectives in breweries of Ethiopia. The result shows that, cost, product quality, demand and competition have direct and significant relationship with determination and achievement of pricing objectives in breweries of Ethiopia with P ≤ 0.05. r=0.665, 0.695, 0.516 and 0.383 respectively. Moreover, financial objectives were found to be dominant over competitive objectives in breweries of Ethiopia. The study also found that, cost is the most determinant of pricing objectives with a mean average of 8.46, competition has an impact on pricing objectives an average mean of 8.42, product quality has an impact on pricing objectives a mean average of 8.37 and demand has an impact on pricing objectives a mean average of 8.23. According to these findings, cost is the most determinant factor on pricing objectives particularly on financial objectives. Whereas, product quality, demand and competition have higher impact on competitive objectives than financial objectives. Companies pursuing financial objectives are recommended to strictly consider cost without forgetting its competitive advantages whereas, companies pursuing competitive objectives are recommended to give higher attention for competition, product quality (differentiation) and demand without forgetting the influence of cost.
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Pricing objectives, cost, product quality