ALTERNATE PRICING STRATEGIES IN CONSTRUCTION

Authors

  • Krishna Mochtar Indonesia Institute of Technology, Department of Civil Engineering, Serpong, Tangerang 15320
  • David Arditi Illinois Institute of Technology, Department of Civil and Architectural Engineering, Chicago, USA

DOI:

https://doi.org/10.9744/ced.2.1.pp.%2056-64

Abstract

Recent research findings on pricing strategies both in general and in construction are reviewed and explored. First%2C pricing strategy in general%2C mostly in the manufacturing industry%2C is reviewed. It includes the concepts of pricing strategy%2C predatory pricing%2C price wars%2C and price policy development. Second%2C pricing strategy in construction is explored. It includes various pricing models for bid price determination%2C such as the Friedman-Gates models%2C expected utility models%2C risk-pricing model%2C and the crew-day%2C multiple regression%2C and fuzzy-set pricing models. In conclusion%2C pricing strategies in construction are still predominantly based on a cost-based approach. More recent models try to close the gap between the models and the real life conditions of a bidder%5C%27s decision-making process. It appears that there are more problems in cost-based pricing as opposed to market-based pricing. Consequently%2C it is highly recommended that%2C alternative pricing approach such as that are closer to the proposed market-based pricing model need to be explored and developed for use in the construction industry.
Abstract in Bahasa Indonesia :

Pricing+strategy%2C+cost-based+pricing%2C+market-based+pricing.

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Published

2004-06-02

How to Cite

Mochtar, K., & Arditi, D. (2004). ALTERNATE PRICING STRATEGIES IN CONSTRUCTION. Civil Engineering Dimension, 2(1), pp. 56-64. https://doi.org/10.9744/ced.2.1.pp. 56-64

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Section

Articles