Value Pricing

Posted in Operations and Supply Chain Terms, Total Reads: 1533

Definition: Value Pricing

Recently companies have started adopting itself to value pricing in which it tries to win loyal customers by charging them a fairly low price for higher quality product or services. Thus value pricing is not only means setting low prices but it requires lot of re-engineering and improvement in its operation to become a low-cost producer.

All this is done without sacrificing on the quality, thus attracting a large number of value-conscious customers.

A commonly used value pricing known as Everyday Low Pricing (EDLP) which is mostly used in big retails tries to keep the price low for a very low period. This eliminates week to week price uncertainty for the customers thereby boasting customer’s value proposition for that product. 

Eg:  One of the best examples of value price is IKEA furniture store who as kept its prices highly competitive thank to its innovative operational processes and delivery system.


Hence, this concludes the definition of Value Pricing along with its overview.


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