Price Premiums Operations Management Assignment Help

Price Premiums

Second when a firm is the first to oring a new product to market it has little or no competition and can therefore charge premium prices as shown in Exhibit 3.1B while the competition struggles to catch up. This combination of market share and price premiums translates into significant profits as seen in Exhibit 3.1C (which in turn provide the necessary funding
to develop and introduce the next round of new products). Thus. the faster a product is

Price Premiums

Price Premiums

introduced into the market ahead of the competition. the more profitable that product is over its entire life cycle. In fact  products that are late to market have a much more negative impact on profitability than do cost overruns in either the product development phase or production.

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