1. Food Wholesaling and Retailing
Part E
AGEC 364

2. Pricing Complex process
multi-product sellers with considerable pricing flexibility
set prices to differentiate their stores from competitors

3. Importance of Pricing
Food retail pricing impacts farmers and consumers
Through food pricing and promotional policies, food retailers influence consumer demand, farm prices, and the movement of farm products

4. Pricing Strategies Market basket pricing Variable price merchandising
“Every-day low pricing”

5. Market Basket Pricing
Provides retailer with considerable flexibility in pricing individual food items
Total dollar sales must cover expenses, but they do not have to follow wholesale or farm prices
May have low dairy prices and make up with higher meat prices

6. Variable Pricing
Use temporary, selective price cuts to differentiate their store from competition and attract customers
Loss leader or weekend sales circular
Example: 20% of all food items are priced at or below cost

7. Everyday Low Prices Competitive prices with other retailers.
Do not focus on sales.
Can meet competitors prices.
Walmart is example.