Marketing Computed Axial Tomography (CAT) Scanners
Admittedly, any multinational company which distributes its products worldwide faces complex pricing issues. Companies that are sourcing companies experience a strong currency have even more complex pricing decisions to make. Thus, the product cost is quite high, and worldwide distribution presupposes a wide range of prices which can be quite unprofitable. Many companies implement such strategies as organizing joint ventures, shifting manufacturing to countries with low wages, taking advantage of currency fluctuations, and trying to minimize expenditure. Thus, Japanese and German auto companies used to adjust “their home-currency prices.” Admittedly, many marketers seek to take advantage of currency exchange and try to influence the economies of other countries. Of course, the high-technology market is quite profitable, especially if it deals with medical equipment, such as CAT. On the one hand, this equipment is quite costly, and the primary factor in pricing is quality.
Thus, it is quite risky to shift the manufacturing to low wages country since the product can lose the image of its high quality. For instance, Mercedes cars are valued for their German reliability. Thus, medical equipment should also be manufactured by a company that is regarded to be reliable. Swiss watch may be the only successful example of shifting the manufacturing to a low-wage country; moreover, the company admits that the labor costs are quite irrelevant. Thus, the most effective pricing strategy for a company having manufacturing in a country with a strong currency situation is the reorganization of distribution and advertising campaigns. First of all, it is necessary to minimize transportation expenditures. It can be possible to join a joint venture or contract with several distributors.
Thus, there will be no necessity to organize own distribution, which is quite costly. However, it is essential to launch an advertising campaign that will promote the quality of this medical equipment. The main stress in such a campaign should be made on the sourcing country underlying that in spite of the difficult economic situation in the global market, the company values the high quality, traditions, and innovations which this company continuously reveals. Another possible way to enter or keep positions in the global market is by making pricing decisions in accordance with consumers’ purchasing abilities. Thus, it can be helpful to keep quite high prices for countries with good purchasing abilities and reduce prices for markets with low purchasing ability.
Of course, the latter strategy will not considerably influence the whole situation but will provide the company with some options. There is one more strategy to improve the situation due to human resources policy reorganization. It is possible to save some finance at the expense of implementing a non-monetary appreciation system. For instance, it is possible to replace monetary bonuses with promotion opportunities. This will also give some extra options to the company. Thus, there are several effective ways to maintain in the global market: advertising campaigns, distribution reorganization, human resources policies reorganization, and making thoughtful pricing decisions for different markets.