Practice Pricing data * Take on the different roles within your team: (Suppliers/ Manufacturers/ Wholesalers/Retailers) * Everyone has a fixed cost of $10 Everyone has a variable (activity) cost of $1 The total market demand is 1000 units. Maximum retail price customer is willing to pay is $10 The following assumptions/decisions have to be made * Customer demand (at each step) How much profit do you want to make (at each step) which has an impact on the price you charge the next downstream step Things to remember about real life: * There is a fixed total demand that is distributed amongst all the choices. * If your price is too high, your demand will likely be lower than someone else who is charging less * If you charge too little then you don't make as much profit. * The different players in the supply chain don't reveal what their costs and margins are. Calculate your Cost/unit and selling price/unit based on the above calculations and the data you have been given. You should have an end result that looks like this. Your numbers in each column will depend on the choices you make Selling Est Demand Profit Margin Cost/unit Price/unit Role Supplier Producer Wholesale Retailer