Raise Price to Improve Revenues and Margins

CHOICE 1: SELECT THE OBJECTIVE OF THE PRICE INCREASE

B.
Price the same, reduce Performance and Cost

No.	SIC	Year	Notes
1	2000	2009	Profits at the large branded food makers are rising despite the recession in part because companies have continued to raise prices and the rate at which cheaper generic brands are making inroads has moderated. The nation's largest food company, Kraft Foods Inc., said that improved margins and a slowing in retailers' inventory reductions helped boost its first quarter profit 10%. Its organic revenue grew 2.3%, with prices pushing up revenue by 5.7 percentage points from the year before. Kraft's better-than-expected earnings followed improved profits from giants Kellogg Co. and Hershey Co. While cheaper private label brands continue to grow in market share, the growth is slower. And although branded companies have had to cut prices in some categories, they have avoided the widespread price rollback some investors have feared.
2	2095	1990	Last year, coffee producers converted their can size to 13 oz. from 16 oz. Consumers didn't view this as value added, though the producers claim the smaller cans yield the same # of cups.
3	4812	2006	As cellular service providers roll out Internet-accessible services and devices, consumers are finding that their access may be limited. Often, applications which consume large amounts of capacity such as Internet calling, video streaming and routers which allow multiple users to tap into the connection are prohibited.
4	6141	1989	High-volumes are available with customers who are credit risks but who charge high volumes on their cards. Citi and others issue credit cards whose outstanding debts are covered by a certificate of deposit.
5	7374	1995	Since 1990, CES has lost several major National customers on high prices, most of whom have been voluntary: CES has forfeited relationships with several higher-risk customers, including United Airlines, Northwest Airlines, and Macy’s, by requiring them to have substantial cash reserves to protect CES’ potential liability. While CES prides itself on its risk management policies, this situation has enabled less risk-averse competitors such as NPC, First Bank Systems, and NaBanco to get into these high-volume relationships. When CES has lost customers since 1990, it has most often been on the basis of high prices, and the Company loses on price far more often than other competitors.

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