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CIPS Exam L4M5 Topic 9 Question 63 Discussion

Actual exam question for CIPS's L4M5 exam
Question #: 63
Topic #: 9
[All L4M5 Questions]

Premium pricing strategies used by suppliers are characterised by which of the following? Select TWO that apply.

Show Suggested Answer Hide Answer
Suggested Answer: C

Competing is assertive and uncooperative, a power-oriented mode. When competing, an individual pursues his or her own concerns at the other person's expense, using whatever power seems appropriate to win his or her position. Competing might mean standing up for your rights, defending a position you believe is correct, or simply trying to win. Competing will not allow long-term relationship to flourish.

Compromising is intermediate in both assertiveness and cooperativeness. When compromising, the objective is to find an expedient, mutually acceptable solution that partially satisfies both parties. Compromising falls on a middle ground between competing and accommodating, giving up more than competing but less than accommodating. Likewise, it addresses an issue more directly than avoiding but doesn't explore it in as much depth as collaborating. Compromising might mean splitting the difference, exchanging concessions, or seeking a quick middle-ground position. It is a valid approach when long-term relationships are at stake and it is important to find some common ground on which to base an agreement. Both sides get something but not everything. Therefore, this is the most appropriate for this scenario.

Avoiding is unassertive and uncooperative. When avoiding, an individual does not immediately pursue his or her own concerns or those of the other person. He or she does not address the conflict. Avoiding might take the form of diplomatically sidestepping an issue, postponing an issue until a better time, or simply withdrawing from a threatening situation. In the scenario, both parties want to take the opportunity, then avoiding is not an appropriate solution.

Accommodating is unassertive and cooperative---the opposite of competing. When accommodating, an individual neglects his or her own concerns to satisfy the concerns of the other person; there is an element of self-sacrifice in this mode. Accommodating might take the form of selfless generosity or charity, obeying another person's order when you would prefer not to, or yielding to another's point of view. In the scenario, neither party shall concede all of their requirements, it is unnecessary to adopt this approach.

LO 1, AC 1.1


Contribute your Thoughts:

Lauran
2 months ago
Ah, the age-old question: do I go with the supplier's reputation or their production costs? Tough call, but I'm leaning towards A and D.
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Tu
16 days ago
User 3: A and D seem to be the winning combination for premium pricing strategies.
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Iraida
25 days ago
User 2: I agree, but I also think D is important because it's about the product life cycle.
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Mee
1 months ago
User 1: I think A is a good choice, it's all about the supplier's reputation.
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Nu
2 months ago
B is interesting, but I thought premium pricing was more about exclusivity and quality, not necessarily for new market entry.
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Lajuana
2 months ago
Haha, 'premium pricing' and 'cost-based pricing' in the same answer? That's like oil and water, my friend.
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Claribel
1 months ago
B) This strategy is often used when supplier attempts to enter new market
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Yuette
1 months ago
A) Products are charged at a price based on supplier's reputation
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Mattie
2 months ago
I believe options A and B are the correct choices.
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Hana
2 months ago
I'm not sure about E - premium pricing is usually based on more than just variable costs, right? There's gotta be some margin in there too.
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Nada
27 days ago
I'm not sure about E - premium pricing is usually based on more than just variable costs, right? There's gotta be some margin in there too.
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Frankie
29 days ago
I'm not sure about E - premium pricing is usually based on more than just variable costs, right? There's gotta be some margin in there too.
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Katy
2 months ago
I agree, it helps them establish a strong brand image.
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Hayley
2 months ago
I think premium pricing strategies are important for suppliers.
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Markus
2 months ago
A and D seem like the best options to me. Premium pricing is all about leveraging brand reputation and positioning your product in the early stages of the lifecycle.
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Jose
29 days ago
E doesn't seem relevant for premium pricing, it's more about overall value and brand positioning.
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Beckie
1 months ago
I see your point, but B is also crucial as entering a new market often requires a premium pricing strategy.
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Louann
2 months ago
I think C is also important because pricing based on cost structures can help determine the premium price.
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Thora
2 months ago
I agree, A and D are key factors in premium pricing strategies.
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