Value & Price Analysis

Question 1

What are the ways analyzing a price can be accomplished?

Answer 1

1. Compare prices with what was previously paid and adjusting for any cost changes.
2. Use estimated or known cost of materials and labor, plus adding a percentage for administrative cost and fair profit.
3. Compare the price with costs from a similar product from the same supplier with the competitors and adjust for probable cost differences.
4. Compare price changes with government price index changes.