what type of pricing objective and strategy should be used by a small company when competing with big ones?

[Bhoomi]

the answer should be in relation to a pharmaceutical company which is currently facing a sudden increase in competition, the firms competing happen to be well established companies.
appropriate terminology would be .
appreciated

[Samantha]

Haven't you ever taken an economics class or anything? Ever heard of Supply & Demand? Make your prices lower than the bigger company, but not low enough that you go bankrupt. It's all about playing the market.

[Joe]

Stay within your means and do not ever compromise on price. I had done the same thing in Australia, I went against a big chain of convenience stores, in a small suburb called Forest Lodge. What followed was history. My company was targeted and taken down, even when I called a truce. All they said was that they wanted to buy me out at a fraction of the price. They did and virtually ruined my life. They can afford what you cannot. I personally called it the luxury of unique positioning( including geo political strength and advantage).
I did succumb; lost a lot of money. The important part was not the money but the targeting and taking down of my entire world around me while I watched. It is hard and is a dangerous venture. Huge companies are very good and do offer a lot, there is a flip side which is their strength and the way they deal with threats. It is a dangerous world. Where they can make you lose your mind and brainwash you to lose yourself. All I am offering is the truth. We live in the so called technologically advanced future.
Just stay out of the competition or get out of the market. We do not live in a world of fairy tales or santa clause. David always loses against goliath. The system is build like that.
Hope the answer helped. Good luck!

[Balaji]

In pharmaceutical industry consumer pricing strategies are not applicable because consumer buy on medical prescription but not at his choice. Promotional offerings made to the doctors(free samples) and frequent visits of salesmen to the doctors to educate about the product and the company are essential. Up keeping of the stock with retailers to meet the created demand by doctors is to be achieved with heigh margins,credit and discounts to retailers. Taking these into consideration your pricing objectives are:
1. Survival in the market
2. Reaching break even at lower level of volume of sales
3. Create image in the mind of doctors
4. Attracting retailers to hold stock

[sailesh]

Reduce your production cost then you can give retailers, doctors and others large profit.Automatically doctors prescribe your drug then it enhance your sales.

[smahadevan39]

Think about Nirma who competed MNCs and was successful. Try to adopt their strategy.