Pricing Strategies in Pork-based Agribusinesses: Evidence from Zimbabwe
Agribusinesses utilise an array of pricing strategies and practices that may be effective under certain circumstances. Price dictates income, directs the quantity supplied and demanded, provides an indication to customers, and shifts ownership. The objective of the study was to evaluate the current pricing strategies being employed in the Zimbabwean pork industry. The study utilised a cross-sectional survey of 166 pig producers, six pork abattoirs and 24 pork butchers in Mashonaland Central Province of Zimbabwe. A standardised pre-coded questionnaire was the research instrument utilised. Descriptive statistics, MANOVA and multiple linear regression were utilised to analyse the data. The results indicated that agribusinesses were utilising break-even pricing, which is cost-oriented, through a formula price, pursuing profit-oriented pricing objectives, through a one-price policy, aiming for a low-penetration pricing policy, with no discount policy and managing a profit-to-cost ratio between 0% and 4%. The study recommends that the industry be flexible in its pricing mechanisms through utilising sales-oriented objectives and appropriate discount policies to induce “goodwill” within the industry. The industry is also recommended to vertically integrate in order to spread and dilute price risk to allow flexibility in pricing, and to utilise premium pricing.
Copyright (c) 2019 Saul Ngarava
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).