Waving Through the Window
You and your tworoommates are starting a window washing service to help putyourself through college. There are two other well-establishedwindow washing services in your area.
- Should you set your price higher or lower than that of thecompetition? Justify your answer.
One roommate believesthe most important objective in setting prices for the business isto generate a large profit, while keeping an eye on yourcompetitors’ prices; the other roommate believes it is important tomaximize sales and set prices according to what your customersexpect to pay.
- Who is right and why?
- How do the number of competitors in the market in thissituation affect YOUR pricing strategy?
