Pricing Strategies As Practiced By Ford And Perodua Marketing Essay

By and large, civilization is ‘how people life ‘ , which means the manner things are done by people ( Bartlett and etc 2008 ) . There are many different civilizations in different groups of people. In an organisation, civilization is a traditional manner of thought and of making things, which is shared to a greater or lesser grade by all its members and which new members must larn or at least partly accept, in order to be accepted into service in the house ( Palmer, 2007 ) . Culture in this sense covers a broad scope of behaviour such as the methods of production, occupation accomplishments and proficient cognition, attitudes towards subject and many more ( Groseschi and Doherty, 2000 )

2.0 Company Background

2.1 Perodua

The Perusahaan Automobil Kedua Sendirian Berhad which is besides known as Perodua is Malaysia ‘s 2nd largest car maker after Proton ( Perodua, 2005 ) . The stockholders of Perodua are UMW Corporation Sdn Bhd with 38 % interest, Daihatsu Motor Co. Ltd. ( 20 % ) , MBM Resources Bhd ( 20 % ) , PNB Equity Resources Corporation Sdn Bhd ( 10 % ) , Mitsui & A ; Co. Ltd ( 7 % ) and Daihatsu ( Malaysia ) Sdn Bhd ( 5 % ) . Perodua was established in 1993 and in 1994 they lanched their first auto which is Perodua kancil. Perodua chiefly merely produces mini autos. Perodua is rather successful in its concern ventures and its autos are really popular among Malaysians ( Kamaruddin, 2009 )

2.2 Ford

Ford Motor Company is a transnational automotive corporation which is based in Dearborn, Michigan. Based on world-wide vehicle gross revenues, Ford is the universe ‘s 4th largest car manufacturer ( Bloss, 2005 ) . It is besides is besides accounted as the largest company being controlled and managed continuously by a household for more than a 100 old ages. Ford was found by Henry Ford in 1903 ( Wilson, 1995 ) . Ford Company represents a $ 164 billion transnational concern imperium. Examples of autos that are produced by Ford are Ford mustang, Fiesta, Escape, Fusion and many more. Ford Motor Company expanded worldwide with its assembly workss in France, England, Denmark, Germany, Austria, and many more. The astonishing autos and engineering produced and inspired by Ford since the late 1920 ‘s has pushed the universe ‘s gait all the manner into the twentieth century ( Wilson, 1995 ) . Ford continues to be on the head of American car manufacturers and is rapidly deriving land in its effort to repossess the little auto market from foreign makers. Ford has recorded giving the best auto ‘s and service satisfaction that created loyal clients. It has encouraged clients from all over the state to utilize Ford vehicle because of their strong trade name image compared with other vehicle ( Bloss, 2005 ) .

3.0 Management manner

In an organisation, a director has to execute many functions and besides handle assorted types of state of affairs. How they perform and handle depends on their direction manner. A direction manner is an overall method of leading used by a director ( Kotler, 2003 ) . There are few direction manners such as bossy, democratic, participative and laissez faire ( Kotler, 2000 )

The direction manner that is adopted by Ford is Participative ( Wellens, 1980 ) . Henry Ford the laminitis of Ford one time said that ”coming together is a beginning. Keeping together is advancement. Working together is success. ” ( Bloss, 2005 ) . This shows that he strongly believes that excellence will merely be exhaustively achieved through dedication and teamwork ( Bloss, 2005 ) . The ground Ford usage Participative direction manner is because they believe that it is really of import to do the squad feels that they are needed by the direction because success is a two manner street where one individual can ne’er accomplish excellence and success without the aid of circuit squad ( Kervin, 1992 ) . The direction is work such as even the people lower down the organisation are involved in determination devising ( Bloss, 2005 ) . Ford as besides strongly emphasized that everyone related demands to cognize the program hence mundane there is a meeting called Business program reappraisal whereby the top direction and the Ford ‘s executive review the program of work ( Kervin, 1992 ) . This is a ritual carried by Ford in order to construct an effectual squad.

The direction manner that is adopted by Perodua is Autocratic ( Husband, 1975 ) . This is because more so 50 % portions of Perodua are owned by the authorities ( Kamaruddin, 2009 ) . Therefore all the concluding and chief determination is made by authorities. Other portion holders of Perodua are non allowed to do any determination without the blessing of the authorities. Basiclly all the activeties of Perodua is to the full controlled by the authorities ( Chacko, 2006 ) . No 1 else in the company has any power to do a determination or even hold a lead in any activities or procedure in the company.

4.0 Merchandise

Even tough Ford and Perodua are in the same industry, there is a ground why some people prefer Ford autos so Perodua autos and some prefers Perodua autos than Ford autos. This is due to the ways the company ‘s merchandise are made, their merchandising monetary value, the publicity they does for their merchandises and besides the topographic point where the autos are sold. Product is whereby a company produces merchandises that people wants to purchase. The merchandise can be touchable and besides intangible ( Smith, 1976 ) . Before bring forthing a merchandise, the company has to make up one’s mind on which market section they would wish to concentrate on as the merchandise produced will be on the section they have chosen ( Thore, 1971 )

4.1 Merchandise market

Merchandise market is on how a company promotes their merchandise to pull client to buy their merchandise ( Roskin, 1989 ) . There are assorted ways that can be used in order to pull clients for illustration utilizing media, sponsorship ‘s and many more

( Prentice, 2000 ) .

Ford largely promotes their merchandise to the market utilizing media device such as advertizement ‘s utilizing telecasting and besides newspapers ( Sheldon, 1984 ) . Other than that, Ford besides does exhibition throughout the twelvemonth and besides has salesrooms provided in most of the state. Other than that, Ford besides carries out many roads off trip event whereby they bring out their new merchandise and uses in the route trip to pull more clients ( Likert, 1967 ) . While making the merchandise market, Ford has to do certain there is no error made as it will consequence on clients sentiment on the merchandise.

Perodua besides largely promotes their merchandise utilizing media device such as advertisement I telecasting ( Meredith, 2003 ) . Other than that perodua does besides administer booklet house to house really frequently to pull clients. Furthermore Perodua besides sponsor free autos as gift in large events whereby many people will take portion to win a auto ( Othman, and Ghani, 2008 ) . This are few ways that perodua uses to advance their merchandise. Another manner that Perodua uses is that, the company has a contact with Eon bank whereby the bank provides loan for those who would wish to buy Perodua merchandise ( Meredith, 2003 ) . In my sentiment this is one of the best ways to advance the merchandise to market.

4.2 Product development

Merchandise development is whereby a company decides on how to develop their merchandise better in future to avoid failure ( Beimans, 1995 )

Many old ages back, Ford was making bad in merchandise development which lead them to bad lost. However, Ford overcomes this state of affairs by doing better determination ( Kervin, 1992 ) . One of the ground ford face loss was because the auto design that was produce by Ford was non run intoing the markets expectation. Therefore to avoid this, Ford started to engage immature interior decorator that universe give better design harmonizing to current coevals of that twelvemonth. Other than that, in order to develop their merchandise Ford besides came by the determination of transforming the concern into a more moneymaking 1 that meets the twenty-first century demand for fuel efficient vehicles ( Bloss, 2005 ) .

Perodua have besides adopted few ways to develop their merchandise better to avoid failure. One of it is the design of the autos ( Perodua, 2005 ) . Many old ages back, the design of perodua autos are non pulling so other autos. Their auto design such as kancil, kelisa, and kenari was really simple and did non pull many clients to buy their merchandise. In order to get the better of this Perodua came out with better design autos that meet today ‘s coevals ‘s outlook which is Myvi ( Perodua, 2005 ) . Other than that, perodua besides develop their merchandise by coming out with bigger autos such as Alza which is more comfy is appropriate for household ‘s as before this Perodua have ever been known as a company that industry little autos such as kancil that was much preferred by ladies ( Perodua, 2005 ) .

4.3 Product Differentiation

Product distinction can cut down dainty of purchasers ( Reid, 1997 ) . When a company sells a differentiated merchandise than other company ‘s they gain the market leader of that peculiar merchandise ( Bennett, 1997 ) . Buyers interested in buying this peculiar merchandise must purchase it from a peculiar house. Any possible purchaser is reduced by the ability of a from withhold extremely valued merchandise or service from a purchaser ( Hesterly, 2008 ) . Even when companies offer the same merchandise, purchasers will see a difference based on the company or trade name image.

Ford is more into comfort and they are different in footings of quality. This is because Ford produces their merchandise on the term of quality oriented ( Wilson, 2005 ) . Most clients prefer to buy Ford autos because the safely degree of Ford autos are higher than perodua autos. There are besides high societal autos that are mark for high income clients. This is how Ford differentiates them with perodua.

The factor that differentiates Perodua than other autos is the monetary value of the autos. Perodua autos are much cheaper and low-cost for many people ( Kamaruddin, 2007 ) . Other than that, perodua autos are besides low gasoline premise autos which are preferred by clients due to the high gasoline monetary value presents. Another factor that differentiates Perodua uses is that, the company has a contact with Eon bank whereby the bank provides loan for those who would wish to buy Perodua merchandise ( Kamaruddin, 2007.

5.0 Monetary value

In general, monetary value is defined as the sum of money charged for a merchandise or service ( Senior, 2006 ) . Price is whereby the sellers have to find monetary value for their merchandise. They have to do certain that they sell the merchandise at a monetary value whereby they can do net income and besides cover cost and besides non being to high that can turn away their clients ( Kotler, 2000 ) .

5.1 Price snap of demand

Price snap of demand is step of the sensitiveness of demand to alter in monetary value ( Kotller, 2006, ) . Sellers needs to cognize about the monetary value snap as it will explicate or in consequence shows on how antiphonal demand will convey alteration in the monetary value of the merchandise ( Senior, 1997 ) . When the demand of the merchandise goes up, the monetary value of the merchandise will besides travel up and when the demand goes down the monetary value goes down ( Kinicki and Williams, 1998 )

Therefore, when the demand of Ford and Perodua autos goes up, the monetary value will besides goes up. This is because when there is a high demand on merchandise there will be many clients that want to buy the merchandise ( Gates, 1999 ) . This is because as the demand goes up, the supply will travel down and there will be limited autos that are available. Therefore, clients are willing to pay high monetary value on the merchandise and this will convey net income to the company.

5.2 Price repair

A merchandise monetary value is non set easy ( Bateman and Snel, 2002 ) . Before puting the monetary value of a merchandise or service, the company has to look at other factors that cover different points in its line ( Gurtinon, 1997 ) . These factors can be internal factors and external factors. The chief factor that the companies have to look in is the costs. Cost ‘s set the floor for the monetary value that the company can bear down for its merchandise ( Draft, 2000 ) . A company would desire to bear down a monetary value that would cover all its bring forthing, distributing, and selling the merchandise and besides them input and end product stuff in order to derive net income ( Gurtinon, 1997 ) . A company ‘s cost may be an of import component in its pricing scheme. Many companies work to go ‘low cost manufacturers ‘ in their industry ( Kotler, 2003 ) . Companies with lower costs may put lower monetary values, which result in greater gross revenues and net income. There are many types of cost that has to been see before puting a monetary value such as fixed cost, variable cost and besides entire cost ( Bennett, 1997 ) .

For illustration, the quality of merchandise produced by Ford is high which means Ford uses high engineering in order to bring forth their merchandise ( Noel and Charan, 1997 ) . Other than that, the stuff used by Ford is much better and higher quality so Perodua. The labours used by Ford are besides those with higher making and those with better instruction background. From this it can be conclude that the cost used by Ford in order to bring forth their autos is high, hence the monetary value of their merchandise is higher but with better quality ( Sheldon, 1984 ) .

On their manus, Perodua autos are budget oriented whereby the cost used in order to bring forth their autos in non high ( Othman and Ghani, 2008 ) . This is because ; perodua autos are non every bit high quality as Ford autos are. Even the security degree of Perodua autos is low ( Meredith, 2003 ) . This is because the stuff used to construct their autos is non as solid and better quality as Ford. Therefore Perodua autos are cheaper than Ford autos due to the cost.

5.3 Price Quality

A company might make up one’s mind it wants to hold the highest quality merchandise on the market ( Prentice, 2000 ) . This usually entails bear downing a high monetary value to cover the high merchandise and high cost of R & A ; D ( Roskin, 1989 ) . For illustration, Ford produced high quality autos with higher engineering usage and higher safety degree than perodua. Perodua autos quality is non really high therefore the Ford has set the monetary value of their auto higher so Perodua in order to cover the their R & A ; D cost while because perodua does non utilize high cost on R & A ; D they are able to come out with lower monetary value autos.

5.4 Rivals Price

Another factor that affects the company ‘s pricing determination is the rival ‘s monetary value and their possible reactions to the company ‘s ain pricing scheme ( Bateman and Snell, 2002 ) . For illustration, one of Ford rivals is Toyota. Therefore it is of import for Ford to hold path on the pricing of Toyota autos. If Ford followers a high monetary value, high border scheme, and so the clients might see other company ‘s to buy their autos that follows lower monetary value and this will do Ford to face lost. Lapp goes to perodua whereby their chief rival is proton. Therefore these companies needs to larn the monetary value and quality that each rivals offer before puting their monetary value.

6.0 Comparison

6.1 Similarity

Ford is more towards merchandise quality oriented where else Perodua is more towards budget oriented. However, both this company has the same end and mission which is to capture and rule the market. Other than that, the selling method used by both these company is the same which is both these company uses media to advance their merchandise and besides does route shows.

Other than that, both Ford and Perodua use the same hierarchy type of direction that consists of lower degree and higher degree. Since Ford is quality oriented, most of the workers are skilled and extremely educated. While for perodua, there are both lower degree and extremely educated of worker. In other words, both the company ‘s has given chance to many locals and alien workers the chance to work with them.

6.2 Differentiation

Perodua are fundamentally little autos that are built in simple design and non construct for manner personality. These autos are low-cost for those with low income and besides moderate income. Perodua autos are largely aim on the ladies drivers. While on their manus, Ford autos are build with better design and are largely large autos and more comfy so Perodua. Ford autos are design for high income and average income clients. Customers do non mind paying more to purchase ford autos due to the design and quality of the autos.

Other than that, Ford has subdivisions all over the state and besides offices in most of the states whereby clients are able to ask and purchase autos easy. This is because, Ford is a transnational company and it ‘s good known. Ford has experience in the vehicle industry for many old ages compare to Perodua which has late come in the industry. Other than that, Perodua merchandises are largely recognized in Asiatic companies merely.

Another different between Ford and Perodua is that Ford is a private company while for Perodua more than 50 % of their portions are owned by the authorities. There is a immense engagement of the authorities in about all the determination devising in Perodua and all the concluding determination is made by the authorities. Perodua is non allowed to do any move without the recognition and the blessing of the authorities while for Ford, there is no authorities engagement in the determination devising. All the determination in Ford is made by their Chief executive officer and their portion holders.

There is besides a immense different between Ford and Perodua merchandises. Ford merchandises are all quality oriented whereby Perodua merchandises are budget oriented. This is the ground why there is a immense monetary value different between Ford autos and Perodua autos. The autos that are produced by Ford are autos with better engineering usage, high quality and high safety degree. While for Perodua, their autos are non every bit strong as Ford and the safety and quality degree of the autos is low.

7.0 Recommendation

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