Components of cost

There are two categories of cost they are product/ production cost and
period or fixed cost

Product cost is generally associated with the production or manufacturing

the food product.

Period cost involves cost other than the production cost such as plant or
building rent , taxes, marketing cost and etc.

Next lets see about the pricing practices followed in this industry

Cost based pricing : cost based pricing , in simple terms the price is fixed by
keeping the cost of the product plus the profit margin .

Market based pricing is a pricing techqu adapting the on going pricing

prevalling in the market

Seasonal pricing is an important pricing strategy followed in packaged food

industry , these pratices are followed during festival times like Diwali ,
genrally the prices are high during this time , the companies enjoy the festival
demand by quoting their products higher than usual .