Taking a product directly to the consumer does not eliminate marketing functions. Channels of distribution provide the way for owner's product to move to customers. So how a business distributes their product is one of the most important decisions an entrepreneur must make. The pricing of goods and services in all types of business is similar in several basic ways. Cost-plus pricing techniques do not take customer demand into account, so the price may not be what customers are willing to pay.
Pricing is perhaps the most complex marketing decision.
There is no one best formula to use to establish prices. A price strategy is only effective if the customer is willing to pay the price and a profit is received. Some computer and technology advancements have simplified pricing decisions. To be successful, a marketing strategy must set prices that are both satisfying to customers and profitable to the business. Retailers have some of their prices suggested by manufacturers and wholesalers.