Abstract:
The study intended to examine pricing practices in case of Bahir Dar Textile Share Company. Marketing
strategies are used to apply product into market and attract customers. Their activity needs to match with
every single market in different way and managers need to focus on customers’ demands and potential
competitors. They have to analyze all factors, which can influence customers’ purchasing power and
product choice. Organization’s success is measured by the amount of selling as well as customer
satisfaction and behavior which can be influenced by pricing strategy. The main research methodology
adopted is descriptive study. The researcher has collected primary data using questionnaire and interview
whilst the secondary data were obtained by document analysis. To collect primary data, purposive
sampling technique for employees, random sampling for wholesalers, and time location analysis for
customers were used. Both qualitative and quantitative analysis techniques mainly descriptive analysis
tables, pie charts and percentage were employed. Findings revealed that the top three factors considered
when setting the price of the company products are cost of production, competitors’ prices for similar
products and desired profit margins. Price sensitivity of customers and selling price of distributors is not
taken in to account to set the price. Regarding to discounts and allowances, the company provides cash
discount for prompt payment and quantity discount for volume purchase but not trade discounts to
distributors for performing distribution functions and promotional allowances for performing some
promotional activity. Product is the most important factor and price is second key factor which hampers
customer satisfaction and organizational performance. Generally, pricing practices in Bahir Dar Textile
Share Company was poor as per the investigation.
