Question
L Ski Inc., a package delivery company in Japan, was contemplating a new service in the Tokyo area. They want to pick up skis from
L Ski Inc., a package delivery company in Japan, was contemplating a new service in the Tokyo area. They want to pick up skis from customers' homes and deliver them slopeside. The average Japanese skier went skiing about 5.5 times per year, mostly on weekends (2-day ski trips). Also, the average Japanese skier spent about $1500 per year (including equipment) and skis cost $1000 on average, bought every 4 years. Alternative to purchasing skis, skiers could rent skis at the resorts for about $50 per day. How much should L Ski Inc. charge for this service? Currently, there is no other competitor who is offering such a service, but it is likely L Ski Inc. will have to soon contend with competitors offering similar services. (Hint: think about what the daily cost of owning skis would be. Then, estimate a maximum WTP and provide your reasoning for how you would adjust your price point.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started