What is the goal of pricing?

• A. To cover operational costs and make a profit
• B. To maximize customer satisfaction
• C. To match competitor pricing
• D. To clear inventory quickly

Answer: (A)

Pricing primarily serves to cover the costs of running the business and to generate a profit. The price needs to cover fixed costs (like rent and salaries) and variable costs per unit, plus a margin that sustains operations and funds growth or investment. Without ensuring financial viability, the business can’t continue, fund quality improvements, or weather fluctuations. Other goals like maximizing customer satisfaction, matching competitors, or clearing inventory can influence pricing, but they are secondary effects or tactics. They don’t guarantee sustainability on their own, whereas covering costs and earning a profit does.