What are the reasons that lead enterprises to raise prices?

What are the reasons that lead enterprises to raise prices?

Although the price increase has brought profits to the company, it will also cause dissatisfaction among consumers, dealers and salesmen, and even lose their competitive advantage. In the following two cases, enterprises will consider raising prices;

1) cost inflation. This is a global problem. The rising cost of materials, fuel, labor, freight, research and development, advertising, etc. It has caused enterprises to reduce their profit margins, which has also caused enterprises to raise prices regularly, and the range of price increases is often greater than the increase in costs.

2) Demand exceeds supply. When the company's products can't meet the needs of all consumers in the market, it may increase the price, reduce or limit the demand. When the company raises the price, it should let consumers know the reasons for the price increase through certain channels and listen to the feedback from consumers. The company's sales staff should help customers find economical and practical methods.

3) competitors raise prices, etc.

References:

Lecture 5: China Marketing Director CMO Whole Course Training.