2 Tronn+ PESA = 4 Tronn (Conservative Approach)

R & D Cost of PESA software development 2000000

Cost of Tronn 1538
Price of Tronn 2000
Cost of Ontario Zink 1214
Price of Ontario Zink 1700

Year 2001 2002 2003

Market of Basic Server (Units) 50000 70000 92000
Market Share of Atlantic 4% 9% 14%
Sales of Atlantic Tronn Server(Units) 2000 6300 12880
Total Sales( 3 Years) 21180
 Status Quo Pricing
Price of Tronn $2,000
Total Sales $21,180
Revenue Generated ( 3 Years) $42,360,000
 Competitive Pricing (2 Tronn+ PESA = 4 Tronn or 4 Ontario Zink (Conservative Approach))
R & D Cost of PESA software development
Price of Ontario Zink
Price of Tronn
Number of servers required of Tronn
Number of servers required of Ontario Zink
Total Price of Ontario Zink(4 units)
Total Price of Atlantic Tronn +PESA (2 units)
Total Price of Atlantic Tronn +PESA (1 units)
Number of units sold Tronn server
Number of units sold Tronn bundle
Revenue generated (part1)
Revenue generated (part2)
Total Revenue Generated
vative Approach)) Cost-Plus Pricing
$2,000,000 R & D Cost of PESA software development 2000000
1700 Number of units sold Tronn bundle 10590
2000 Per Unit Price of PESA Software 188.86
2 30% Markup(PESA Software) 245.51
4 Cost of Tronn 1538
6800 30% Markup(Tronn Server) 1999
6800 Total cost Per Unit 2245
3400 Number of units sold Tronn server 10590
10590 Number of units sold Tronn bundle 10590
10590 Revenue generated (part1) $23,773,646
$18,003,000 Revenue generated (part2) $21,180,000
$36,006,000 Total Revenue Generated $44,953,646
$54,009,000
 (Value added Pricing (2 Tronn+ PESA = 4 Tronn or 4 Ontario Zink (Conservative Approach))

2 Tronnserver + PESA
Electricity cost ($) 500
Price of server 4000
Cost of software 1500
Labour cost 4000
Total cost 10000
Saving for Tronn users when compared to Next best option

Adding savings to Price of Tronn

Price of Tronn(2 Units) 4000
Savings (Added Value) 8800
Total price (2 Units) 12800
Total price (1 Units) 6400

Price of Tronn 2000

Price of Tronn+PESA 6400
Number of units sold Tronn server 10590
Number of units sold Tronn bundle 10590
Revenue generated (part1) $21,180,000
Revenue generated (part2) $67,776,000
Total Revenue Generated $88,956,000
Ontario Zink (Conservative Approach))

4 Zink Server
1000
6800
3000
8000
18800
8800
Pricing Technique Revenue Generated Money left on the table
Status quo Pricing 42360000 46596000
Cost- Plus Pricing 44953646 44002354
Competition- based pricing 54009000 34947000
Value- in-use pricing 88956000 Recommended Pricing Method