Definition Definition

Volume objectives

Definition (1):

Volume objectives are the basis of pricing decisions on market share, the percentage of a market controlled by a certain company or product.

Definition (2):

According to Prof. Allen, "Volume objectives include sales maximization and market-share goals, which are specified as a percentage of certain markets. In sales maximization, management sets an acceptable level of profitability and then tries to maximize sales.  This objective can lead to discounting or some other aggressive pricing strategy, such as rebates and sales. "

Definition (3):

Volume objectives are also known as sales-related objectives. The main of these objectives of pricing can include the following:

a) Sales Maximization: The objective of a company is to maximize sales volume. It fixes its price in a way that maximum sales can be attained. It is predicted that sales maximization has a direct effect on profits. So, pricing decisions are made in such a way that sales volume can be increased. Fixing price, changing the price, and changing pricing policies are aimed at improving sales.

b) Target Market Share: A business targets its pricing policies at maintaining or attaining the target market share. Decisions regarding pricing are made in a way that the business can achieve the targeted market share. A certain sales volume determined considering an industry’s total sales is known as the market share. For instance, businesses can try to attain 30% market shares in the industry.

c) Increased Market Share: Often, price, and pricing are considered as the tool for increasing a company’s market share. When a company’s market share is below its expectation, it may raise it by proper pricing. Pricing is targeted at the betterment of market share.

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