Pricing decisions in micro and small businesses

What is it about?

Micro and small businesses need to define prices for products, goods and services, but this decision is often difficult in practice. This study examines how managers of micro and small enterprises make pricing decisions. It looks at whether they base prices on costs, customers or competitors, and whether managers’ personal characteristics are related to these decisions. The results show that measuring costs is one of the main difficulties faced by these managers. Many businesses give strong weight to market prices and do not formally use costing methods. Some managers use costing ideas intuitively, but without full knowledge or proper application. In plain terms, the article shows that pricing in small businesses often depends on experience and market signals, even when better cost information would support more consistent decisions.

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Photo by Siora Photography on Unsplash

Photo by Siora Photography on Unsplash

Why is it important?

This work is relevant because pricing affects profitability, competitiveness and business survival. Micro and small enterprises often operate with limited managerial tools and may set prices without enough cost information. The article helps explain why pricing remains a practical challenge, even though the topic is well established in academic research. Its findings can support training programs, local public policies and advisory services focused on cost measurement, market analysis and pricing practices. The study also contributes to research by connecting pricing decisions with managers’ characteristics, which helps explain why similar businesses may adopt different pricing criteria.

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