Pricing of Industrial Products: Case Study of Ghana Aluminium Products Limited (Ghanal), Tema

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The prospects of producing and marketing a new product and hoping that the price in the market will be high enough to generate required profit is often a speculative objective. Product pricing, as a process, is integrated into the company’s overall marketing strategy along with other marketing mix such as the product itself, its distribution and promotion decisions. Great consideration must also be given to the corporate and marketing objectives. Essentially a firm would need to depend on its ability to generate revenue from the sales of its products in order to succeed as an enterprise. But whilst this ability is important and must be pursued, it is necessary for the firm to ensure customer satisfaction, in that optimum revenue and profits cannot be achieved without it. Most Ghanaian companies operate without appropriate pricing strategies and policies. This problem emanates from a number of factors some of which are ad hoc pricing behaviour, exclusion of customer values from pricing decisions, pricing with no market inputs such as market shares, the growth of the industry and competitors’ actions. In this study Ghana Aluminum Products Limited (GHANAL) was used as a case study to focus on the company’s corporate, marketing and in particular its pricing policies and strategies in order to address the above problem. Data on GHANAL were obtained by interviewing management of the company using questionnaire. The study has revealed the importance of good and systematic pricing strategies and the adverse consequences for the lack of it, in any profit oriented business organization, without de-emphasizing the other elements of the marketing mix. It was also identified from the study that industrial pricing is often a compromise involving several factors including the objective of the company, the price that consumers are willing to pay, the prevailing market conditions, cost considerations as well as government regulations. In the case of GHANAL, the study has shown that its major concern is how to remain competitive and at the same time avoid price wars in the oligopolistic market dominated by ALUWORKS.
A thesis submitted to the Board of Postgraduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirement for the award of Postgraduate Diploma in Industrial Arts, 1997