Funeral Merchandising: Pricing
Median
(In a value ordered set of numbers) the midpoint/middle number, or the mean of the two middle numbers if necessary.
Median
(In a value ordered set of numbers) the midpoint/middle number.
Increasing graduated recovery disadvantages
-Consumers are discouraged from buying high end products -Retailer receives the least amount of profit on lower end items -Awkward prices
Modified graduated recovery advantages
-Lower end products are affordable -Consumers encouraged to buy up
Fixed multiple disadvantages
-No CVI improvement -No enticement to buy anything more expensive -Awkward retail prices
Fixed dollar amount disadvantages
-Penalizes lower end purchases -Awkward pricing
Fixed dollar amount advantages
-Simple -Increase in CVI
Generally, a multiple is between
2-4
Most inventory should fall into which quartile?
3rd
Fixed multiple markup
A price determination method whereby item cost is multiplied by a constant factor.
Graduated recovery markup
A pricing method where markup varies.
Vertical merchandising pricing
A range of selection prices with obvious value progression.
Horizontal merchandising pricing
A range of selections at each price point.
Consumerized pricing
An adjustment of awkward prices that creates familiar figures to consumers.
Cash advance items
Any item obtained from a third party and paid for by the funeral home on the purchaser's behalf.
The greatest selection should exist
At or slightly above the targeted sales objective.
With sales frequency data, funeral homes must walk the line between
CVI and profits
Increasing graduated recovery advantages
CVI is high on lower end merchandise
Decreasing graduated recovery advantages
Consumers are encouraged to buy higher value items
Most and least expensive caskets
Creates a perceived middle price and provides bench marks you the customer.
Decreasing graduated recovery is AKA
Declining price structure
Lower priced caskets cannot look too good as to
Dissuade a purchase of a higher end product.
Quartiles
Division of the total into 4 segments; each one representing 1/4 of the total.
In a fixed dollar amount, a specified
Dollar amount will be added to the retail price of an item.
The inclusion of cents gives the impression that something is ____ than it actually is.
Higher
If retail price is lowered, the CVI
Increases
If the retail price is lowered, the MVR
Increases
Increasing graduated recovery
Lower end merchandise receives a lower markup and higher end merchandise receives a higher markup.
Modified graduated recovery disadvantages
Lowest CVI is in the middle
Mark up is AKA
Margin or Gross Casket Margin
Itemization
Method of price quotation by which each unit of service or merchandise is prices separately.
Unit pricing
Method of price quotation that includes both the casket price and the service charge.
Functional pricing
Method of price quotation that is broken down into several major component parts such as person services, facilities, automobile, merchandise, etc.
Bi-unit pricing
Method of price quotation that shows the price of the service and the price of the casket.
Package pricing
Method of price quotation which groups together selected services or merchandise.
Price determination
Method used to establish the selling price for services and merchandise.
Modified graduated recovery is AKA
Modified declining price model
Mode
Most frequently occurring number in a group.
Decreasing graduated recovery disadvantages
People purchasing at the lower end are penalized
A multiple is expressed as a
Percentage. Ex)250% = 2.5 multiple
Fixed dollar amount markup
Pricing determined by the amount of profit necessary on each sale.
Modified graduated recovery markup
Similar to decreasing graduated recovery but, lower end items receive a less aggressive markup.
Fixed multiple advantages
Simple
Average
Sum of a group of numbers divided by the number of units.
Mark up
The difference between merchandise cost and selling price.
Sales frequency data markup
The number of times sales in a given price bracket occurs over a fixed period of time. This requires listening to consumers.
Consumer value index CVI
The percentage derived by dividing the whole sale cost of the merchandise by the retail price of the merchandise.
Merchandise value ratio MVR
The relationship between the wholesale cost and the total cost of both services and merchandise to the customer.
Lower prices caskets should look good to
Those who can afford it
Fixed multiple is AKA
Times factor or Straight line
Range
Upper and lower limits of a series of numbers.
Decreasing graduated recovery
Upper range merchandise receives a lower markup and lower end products receives a higher markup.
