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This research seeks to investigate the role of price in the sale of new and as a profit planning tool for a general phenomenon in an organisation that requires immediate attention, particularly a profit-making organisation.

This study is primarily concerned with whether an effective pricing policy relies on an estimate of likely demand rather than knowledge of loss in order to make a reasonable profit planning decision in a manufacturing organisation (case study of Brazilian hair).

A test was conducted based on the foregoing among some case study respondents, and it was discovered that 20 of the 35 respondents supported that effective pricing policy is more dependent on likely customer demand than knowledge of cost estimate, which was represented by 15 respondents out of 35.

The findings clearly demonstrate that Brazilian hair users' pricing policies and purchasing decisions are based on anticipated demand rather than cost information.

The preceding example led the researcher to the conclusion that any organisation that wants to stay in business and grow quicker than its competitors must consider and consider customer demand and needs before making a final pricing policy or choice.

Chapter one


1.1 Background of the Study

Pricing is a sales strategy for a new business's products or services; it reflects how serious a firm is about competing in the future. A successful pricing strategy plan is supported by carefully collected market, consumer, and competitor data, which may include professional devices.

Pricing strategy plans will help you improve your chances against more experienced competitors and newly emerging ones by allowing you to recognise and act on any trends and consumer preferences that other companies have overlooked, as well as develop and expand your own select group of loyal customers both now and in the future.

The strategy will also demonstrate to others that you have carefully thought how to price an inventive, unique, and marketable product, increasing your chances of stable sales and profits and providing reasons for investors to financially back you.

Setting a pricing for a new product is typically tough because when a product progresses through its life cycle, the initial stages are particularly difficult. Companies developing a new product face the issue of selling for the first time.

They can choose from three key price strategies: market skimming pricing, market penetration pricing, and market demand curve. The price of a new product determines whether it is accepted or rejected. Thus, it has become important to evaluate the impact of pricing strategy on the sales of a new product using Brazilian hair as a case study.

1.2 Statement of the Problem

Price is viewed as a reflection of value. Consumers generally believe that the price of goods and services determines the quality of the product. Business organisations do not appear to value the usage of a good pricing structure in the introduction of a new product.

This effort will look at the following problems:

i. Knowing whether the organization's pricing strategy influences the current economic position in the environment.

ii. whether a pricing approach influences consumer behaviour.

iii. Determine if profit planning results in cost reduction.


1. How does the firm's pricing approach affect the current economic condition in the country?

2. Does a successful pricing strategy influence consumer behaviour through the product?

3. What impact does pricing strategy have on new products?


To fulfil the study's goal, the following hypotheses are formatted.


Ho: The country's consumers' buying patterns are unaffected by pricing strategy.

Hello: Pricing strategy influences the purchasing behaviour of consumers in the country.

Hypothesis Two

Ho: An effective pricing decision is based on information about the cost of Brazilian hair rather than an estimate of likely demand.

HI: Effective price decisions are based on estimates of likely demand rather than knowledge of the cost of Brazilian hair.


This research aims to achieve the following purpose:

1. To understand the impact pricing strategy has on new products.

2. To assess the efficiency and effectiveness of pricing strategies in selected organisations.

3. To identify the numerous elements that influence price decisions in a given organisation.

4. Determine whether price decisions have an impact on a firm's profit and efficiency.

5. To explore if profit planning can lead to cost savings and improved profit performance.

1.6 Scope of the Study

In order to reach the stated goal, this research will be confined in scope to how management's performance of manufacturing enterprises is influenced by the choice of pricing strategy and profit planning. The study will mostly focus on Brazilian hair.


This research will assist organisations in determining the most effective pricing approach based on their specific unique scenario, hence increasing profitability in the and long run.

It will assist them in avoiding making arbitrary pricing decisions without taking into account the unique circumstances and key considerations. It will act as a guide for selecting a pricing strategy that strikes a balance between what buyers want to pay for a product and the price the company is prepared to sell.

This research will also benefit the economy because if enterprises have significant price setting controls, their pricing will improve. Behaviour has the potential to influence national production revenue and, as a result, community welfare.

Finally, this research will be valuable for individuals conducting additional research on this or similar themes.

1.8 Limitations of the Study

As with other studies, acquiring all of the necessary information is often limited.

The primary constraint on this research is time and expense. There isn't enough time to ensure precise correctness and reliability. The attitudes of some Brazilian hair users were unhelpful.

Theories were unwilling to share certain critical material, despite the fact that it was merely for academic purposes. Despite these issues, the researcher considered that a significant work had been completed, and that the purpose of this study and the approach to this target had not been compromised.

1.9 Operational Definition of Terms

Pricing strategy is a guiding concept or plan of action intended to affect and determine pricing decisions. Pricing strategy establishes parameters for attaining objectives.

Profit Plan: This profit plan is the operating plan that details revenue expenses and the resulting income for a given period of time. It is the firm's ideal plan given the high level of management anticipation in the future.

Efficiency: The ability to work or produce effectively without wasting time or resources.

Fixed cost: A cost that remains constant at a given level of production. It does not change with output.

Marking Mix: The mixture of the four basic elements that compose a company's marketing programme: price, product placement, and promotion.

Variable costs are costs that vary according to the degree of production. They remain constant per unit but vary with total production.

Strategy: Strategy is a broad declaration of how an organisation intends to achieve its objectives. The strategy outlines the general approach but does not go into depth on how a company intends to achieve its goals.

Short run: A span of less than one . The firm is unable to change all of its contributions in this time frame.

Long Run: A time period long enough for the firm to adjust the physical amount of all resources used in manufacturing. It is usually five years or older.

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