Pricing of Services

Upon reading chapter 13, I came across the section talking about pricing services.  The book talked about how services are mostly intangible in nature.  By being intangible, customers focus mainly on the price to determine quality.  Most of us would distinguish between two services and products based on the price.  This is seen throughout our world.  Many products and services are identified by their price.  A higher price quite often means better quality. 

For this explanation of pricing services and goods, there are quite a few examples that come to mind.  Upon typing in “services in Bozeman” into Google, this map appeared of services in and around Bozeman.  Many of which provide a service that has competition.  This completion plays a key role into the price of their service. 

For many people, price is the ultimate decision in selecting a service.  Take for instants buy, tires for a vehicle.  For Bozeman there are over 15 listings in the phonebook.  Many of these locations not only provide installation of the new tires, but continual support for your tire, brakes, and oil changes. 

When shopping for tires recently, I encountered a vast difference between companies with essential the same tire.  I spent about a day driving around a asking various company the price, type, quality, etc of their brand of tire.  When it came down to it I took the price into consideration.  The brand name tires where more expensive than other brands, the quality (ply of the tire) changed the price, as well as where you bought the tire. 

At Costco, you needed to be a member, and if purchasing them on a credit card, it had to be American Express.  On the other hand, some companies were just located in and around Montana.  This proved to be difficult because when I travel if I have a problem I cannot take it to their location to have it serviced at a free or discounted rate.  All of these criteria factored into my decision for selecting the right company for me. 

I ended up going with Tire Rama