With regard to bid pricing, a marketing manager should be aware that:
A) the customer is always required to accept the lowest bid.
B) since it costs very little to submit a bid, most firms try to bid for as many jobs as possible.
C) the same overhead charges and profit rates usually apply to all bids.
D) a big problem is estimating all the costs--including the variable and fixed costs that apply to a particular job.
E) All of the above are true statements.

Question

Quizplus · Accepted Answer

While it may sound logical that customers will always accept the lowest bid, this is not always the case. Many factors go into a customer's decision to choose a particular bid. Additionally, while it may not cost much to submit a bid, firms must carefully consider the costs associated with actually doing the job and make sure their bid covers those costs while still allowing for a profit. Overhead charges and profit rates may vary from bid to bid, depending on the specifics of the job. The biggest challenge in bid pricing is accurately estimating all the costs that apply to the job, including both variable and fixed costs. Thus, choice D is the best answer.

With Regard to Bid Pricing, a Marketing Manager Should Be