Product line policy:

It is a set of related products sold by a company.

Some firms may have a narrow product line while others may have a broad product line.
Advantages of the narrow product line: 1.economies of scale due to product specialization and therefore lower production cost per unit. 2.Reduced inventory or holding cost 3.low-cost of designing the product 4.high risk advantages of a broad product line: 1.firms are able to meet the needs of a wide range of customers and at the same time, creating a barrier for other firms from entering the market. 2. high inventory or holding cost 3. high-cost of designing the product 4.low risk

Narrow product line or broad product line depends on:

1. Salesforce; a company's decision to have a broad product line is depend upon the ability of its salesforce to effectively sell each of these products 2.Customer demands: customer demands and expenses involved in the production and promotional activities of these products also influence companies decision to adopt a product line policy

IMPORTANT
Addition of a new product to an existing product line requires change in sales management policy: the company for example may have to train salesforce so it becomes a aware of the lesser known products in the product line

Product design policy: firms changes their

product designs to meet the changing taste and preferences of customers advertisement and promotional policies are also influenced by the changes in product design the protection of product design is made possible by patenting the design and establish copyright protection regulations

Product design policy:

Firms changes their product designs to meet the changing taste and preferences of customers Advertisement and promotional policies are also influenced by the changes in product design The protection of product design is made possible by patenting the design and establish copyright protection regulations Product quality policy: high-quality products require less service and low quality require more service so manufacturers with high-quality products have liberal service policies.

Product service policy:

Manufacturer service policies can be in different forms 1. Educating the customers about the use and care of the product 2. In case of industrial products and consumer goods such as air-conditioning and heating equipments policy is to provide installation inspection and repair.

Policy related to pricing: 3 types

1 pricing on the basis of competition: types are meeting the competition pricing above the competition pricing under the competition 2 Policy on pricing relating to cost: full cost pricing promotion pricing contribution pricing

Policy on discounts:
Trade discounts: manufacturers selling to both wholesalers and retailers may quote different prices that is often different' trade discounts" to each class of customer Quality discounts: reducing the price for purchasing in stated quantity

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