Pricing is the process of determining how much to charge for a product or service. In setting prices, businesses take into account a variety of factors including their own costs, what similar products are selling for and the perceived value of their offering.
Pricing is an important part of product management, and is one of the four Ps of the marketing mix (product, promotion, price, and place). Price is the only revenue-generating element among the four Ps; the others are cost centers. However, the other aspects of marketing can help to reduce price elasticity and enable prices to be increased in order to generate more revenue and profits.