The Swedish manufacturer of Asko dishwashers concluded that consumers would be willing to pay approximately $989 for a dishwasher that was quieter than any other machine on the market.Oriented on this price, Asko determined the margins that would have to be allowed for wholesalers and retailers to give the $989 retail price.Asko used

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Asko used target pricing, which involves determining a product's price based on the price the target market is willing to pay, then working backward to determine the cost structure needed to achieve that price. In this case, the $989 price was the target price, and Asko worked backward to determine the necessary margins for wholesalers and retailers to achieve that price.

The Swedish Manufacturer of Asko Dishwashers Concluded That Consumers Would