Sunday 18 October 2020

Any Service and it's Fees

We need to move away from arbitrary pricing to Pricing derived from formula(s).  Any Service Providers or Function provider or Organization or Company or Government has to adopt deriving of Fees, Rates, Taxes, Charges, Pricing based on the following fundamental aspects, 

1. The Components or Factors impacting the pricing

2. Input Cost

3. Value adds Cost

4. Materials or Raw materials used cost

5. Services Costs

6. Cost of Inflation Index

7. Sales and Marketing Cost

8. Manufacturing Cost

9. Taxes

10. Transportation Costs

11. Cost to the Company

In General the most basic fundamental factors that affect pricing are Cost to the Product (Factors impacting the same) and it's Services, Taxes, Transportation, CRM, Delivery line or Delivery Channel or Chain, inflation, etc. 

Therefore, any service or product or any other rates or charges or fees always have to be derived from Factors fundamentally impacting such a service or product and cost of inflation or inflation index.  

For example the "The First Schedule Fees" as listed in the PDF available in the following link as on date (18th October 2020) does not outline the fundamental basis of it's pricing nor it's pricing strategy.  A function from a Government always should be based on sound Fundamental Principles, Repeatable, Consistency and should stand time.  If it has to stand time in the future as well then it has to be based on Factors impacting a product or service and a formula to arrive at the rates only, 

The formula(s) have to be defined in such a way that it stands time with out much impact to it, in case new factors are identified then the formula(s) have be revised as per new impacting factory by how much they influence or the impact they create on the rate or charge or price. 

http://www.ipindia.nic.in/writereaddata/Portal/IPOFormUpload/1_11_1/Fees.pdf

No Arbitrary Pricing Any more.

What do we think or say about this idea?

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