The development of a product pricing method and demand forecasting model for import SMEs in Vietnam – Case company X Co., Ltd.

Abstract

Pricing and inventory management are indisputably two of the most important issues in business management. Firms have made large investments in these areas to set appropriate prices and manage stocks efficiently. The topics deserve further investigations towards a better understanding and administration of them.

This study aims to investigate pricing and inventory management by using empirical evidence from the case company. In view of the case company data, the study realizes the existence of critical products, possibly mathematical expression between the direct costs of critical products as well as feasible estimations of critical product demands.

The study employs concurrent theories such as the 80/20 Principle, cost-plus pricing and a linear regression forecasting model with seasonal adjustments to develop the five-step pricing method and the demand forecasting model which can be widely applied by both the case company and other interested firms.