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.Based on this price,Asko determined the margins that would have to be given to wholesalers and retailers to arrive at the $989 retail price.Asko used

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Asko used target pricing, which involves setting a price based on the perceived value to customers and then working backward to determine the necessary cost and margins. Asko determined the price point of $989 based on customer willingness to pay for a quieter dishwasher, and then calculated the margins that wholesalers and retailers would need to sell the dishwasher at that price. This approach is characteristic of target pricing.

Swedish Manufacturer of Asko Dishwashers Concluded That Consumers Would Be