Pricing Policies as a Marketing Strategy in the Construction Industry: Case Study of Turkish Companies

Abstract

The firms in the construction industry have to determine pricing and promotion policies, then these policies must be carefully and systematically integrated with the marketing strategies. Not only the demand and cost are important in pricing decisions but competition is also a significant variable to be considered. To determine the difficulties and the affecting factors in applying pricing decisions within the marketing concepts in construction sector, a survey was carried out among the Turkish companies as a sample group. In total 49 companies, mostly medium-size firms have been surveyed. The responses of firms are considered based on their actively engaged subsectors, namely, residential, commercial/public buildings, and infrastructure construction. The answers of firms are also evaluated based on their stated organizational structure, namely, simple, hierarchical, project, and network. The views about the various aspects of pricing policy development in phases, for example before and during bid, differ in the construction companies depending on their actively involved fields and their organizational structures.

Non-technical innovation and entrepreneurship in project-based small service firms

“…In essence, firms with close connections with customers, clients and value chain partners of diverse functions and professions are endowed with a higher relationship-building competency to better respond to site-based uncertainties in relation to successful outcomes of innovative project deliveries (Manley 2008;Preeker & Giovanni 2018). Also, project-based firms are inherently competitor-oriented in their strategic establishment of pricing and bidding strategies for winning project tenders (Coskun, Erdis & Demirci 2013). Where the propensity towards MO is generally stronger in small firms in contrast with larger firms (Pelham 1999;Raju et al 2011), this study makes a clear analysis of the role of market-oriented posture in complementing a business's project-based nature: H1: Market orientation is positively related to entrepreneurship…”

“…From a practical standpoint, innovative marketing efforts are especially important for project-based companies in aiding business development (Dikmen, Birgonul & Ozcenk 2005). A recent study has also demonstrated that construction organisations that carefully and systematically integrated their pricing and promotion strategies with their firm's specific resources had a higher chance of successful tender bidding (Coskun et al 2013).…”

Analysis of project success factors in construction industry

“…Table 1 presents the factors selected from previous literature with the corresponding references. Doloi et al (2012), Wang, Huang (2006), Chua et al (1999), Leung et al (2004) Company's financial strength Alzahrani, Emsley (2013), Ye et al (2009), Coskun et al (2013) Company's technical capacity Alzahrani, Emsley (2013), Ye et al (2009) Scope and work definition Jha, Iyer (2007), Doloi et al (2012), Chan et al (2004), Leung et al (2004), Turner, Cochrane (1993) Clarity of the project mission Jha, Iyer (2007), Chua et al (1999), Turner, Cochrane (1993), Gudiene et al (2014) Planning efforts Effective scheduling Jha, Iyer (2007), Kog, Loh (2012), Tabish, Jha (2012), Jaśkowski, Biruk (2011) Effective project briefing Yu et al (2006) Adequacy of plans and specifications Jha, Iyer (2007), Kog, Loh (2012), Chua et al (1999), Sanvido et al (1992) Effective procurement and tendering methods Chan et al (2004), Pocock et al (1997), Dissanayaka, Kumaraswamy (1999), Mitkus, Trinkūnienė (2008) Adequate project management techniques. Chan et al (2004), Chua et al (1997), Munns, Bjeirmi (1996), Jaselskis, Ashley (1991), Gudiene et al (2014) Control system Jha, Iyer (2007), …”