Marketing Tips: What Is a Reasonable Price?


What is a reasonable price?

I know it doesn’t look like that, but this object in the above image is a lounge chair. The chair can flexibly change its shape by moving each curved board consisting of the outer frame. For your information, the price is highest among our chair lineup. With the same amount of money, you may buy full sets of living and dining furniture at IKEA, for example. I think it’d be very natural for many peole to take it very expensive in the first impression.


Our presiden and product development team are discussing the details of a new table with the designer.


All-out cost reduction efforts

Market prices are naturally fixed by the supply and demand balance. As the supply is likely to exceed the demand by technological development nowadays, price setting becomes more market-oriented, while ours is still product-oriented. I didn’t mean we have power to make a decision on price. For us, a furniture manufacturer, it’s beyond capacity to correctly forecast demand trends. What we can do is just sweating blood to accumulate small improvements and make prices as low as possible.

Bar charts showing how low the average income of people living in Hokkaido.


Bittersweet regional disparity

As the above chart shows, the average annual income is lower in Hokkaido where our headquarters and factory are located. In other words, made-in-Hokkaido products are more value for money (because of the lower labor costs), though I’d rather have mixed feelings than being proud of it as a worker in Hokkaido. Of course, our most expensive chair above-mentioned is no exception. This is a bargain! Please help us to increase the average annual income in Hokkaido.

Shungo Ijima

He is travelling around the world. His passion is to explain Japan to the world, from the unique viewpoint accumulated through his career: overseas posting, MBA holder, former official of the Ministry of Finance.