A cost-plus approach to pricing is more likely than a target costing approach when the product is unique in terms of features, service, or quality.

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A cost-plus pricing approach involves adding a markup to the cost of production to determine the selling price. This approach is usually used when the product is unique and there is limited competition. In contrast, target costing involves determining the maximum cost that can be incurred for a product based on the desired profit margin and market price, and then designing the product to meet that cost target. Target costing is more appropriate for products that have significant competition and require cost efficiency to be successful.

A Cost-Plus Approach to Pricing Is More Likely Than a Target