February 2016

Pricing

Price Tag

I have, in previous posts, raised the importance of defining the industry and to understand what the company offers to its customers, i.e., which right to existence the company has. Once you know your industry, what to offer, and who your customers are, you then need to decide the price of the product.

A while ago I got the question from some young entrepreneurs asking how to price their products. There are, of course, many different more or less complex pricing and business models. However, I decided to share three very basic methods, and I believe these might also be of interest to some of you who read my blog. The basis for the three models are:

The best CEO in the world 2015

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Harvard Business Review (HBR) compiles each year a list of what it finds to be the 100 best-performing CEOs. The 2015 survey included 907 CEOs from 896 companies and represented 46 nationalities in 30 countries. The selection of companies was based on S&P Global 1200. This index includes companies that account for 70% of the world’s stock markets capitalisation.

The results of the 2015 survey were exciting and inspiring when a somewhat unexpected CEO took first place.

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