PRICE TYPE - PRICE BAND
The "Price Band" Price Type is a powerful tool for managing pricing when suppliers use tiered rates based on the number of participants. This means the rate varies depending on the group size, with different price tiers for different ranges of participants. However, it's crucial to pay close attention to whether the price band is applied on a group basis or a per-person basis.
Here's a breakdown:
Group-Based Price Band:
The rate applies to the entire group as a single unit.
The total cost for the group changes based on the group size, but it's a single price for everyone.
Example: A tour costs $1000 for 1-10 people, $1800 for 11-20 people, and $2500 for 21-30 people.
Pax-based Price Band:
The rate is applied individually to each participant.
The per-person cost changes based on the group size.
Example: A tour costs $100 per person for 1-10 people, $90 per person for 11-20 people, and $80 per person for 21-30 people.
Why it Matters:
Accurate Costing: Selecting the correct basis (group or per-person) is crucial for accurate cost calculations. If you misinterpret the basis, you could significantly overcharge or undercharge your clients.
Transparency: Clearly understanding the basis of the price band allows you to transparently communicate the pricing structure to your clients. They need to know if they are paying a single price for the group or an individual price that varies with group size.
Careful Selection:
When using the "Price Band" Price Type, always double-check with the supplier to confirm whether the tiered pricing is applied on a group basis or a per-person basis. This will ensure accurate cost calculations and transparent pricing for your clients.
