Hasbro Financial Impact Paper

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Recommended: Developing pricing strategies

Risk and Financial Impact
There are many risks when launching a new product into the market, especially a market that is full of options and very competitive like the toy industry. With the launch of Hasbro’s new spaceship, they will encounter risks that may negatively impact their finances, their brand and their quality and safety record. Work can be done before the product is even developed, and/or during development and certainly post product launch to help mitigate the risks to the company. When introducing their new product, Hasbro is at risk of failure by overestimating demand or entering an already saturated market. It’s key that Hasbro does their research before developing a new toy and taking it to market. Understanding the current …show more content…

A key aspect of profitability is choosing the correct pricing strategy for their product. By understanding factors like competition, cost and market price sensitivity a company can effectively choose a pricing strategy to fit their product (Hinterhuber & Liozu, 2012). Hasbro can also lean on their years of experience successfully launching toys into the market. This experience will help them, as pricing products can be a bit of an art to go along with the math and developing this intangible can be necessary when pricing a product. Of the three high level pricing strategies: cost-based pricing, competition-based pricing and customer-value based pricing, Hasbro will use a cost-based pricing strategy to set a price that ensures they are turning a profit or at least breaking-even. When setting their price, Hasbro first needs to know the cost to manufacture the toy, including the design and development costs, raw materials, production and third party manufacturing costs, storage, delivery and lastly quality and safety costs. Once Hasbro has gathered the necessary data to calculate the actual per unit cost of producing the toy they can set a price that will return a …show more content…

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Hinterhuber, A., & Liozu, S. (2012, June 19). Is It Time to Rethink Your Pricing Strategy? Retrieved February 22, 2017, from

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