NY Health Club Personal Training Case Study

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58

2) the average price when all respondents are averaged based on time of session = $58.58 (identical)

3) Thus, the average price per hour that would satisfy most of the clients would be $60/hour.

This represents the expanded results of the survey based on members:

Pricing at $60 per hour would be favorable for 45 members, or 40%. Pricing at $50 per hour would be favorable for 65 members, or 58%; This does not mean, of course, that those surveyed would not pay $50, just that their price/value relationship is lower.

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Part 2 -- Two Price Levels; daytime $50/hour, 5pm-9pm TBD. The second way to price the services would be to segment high and low demand. $50 per hour for all hours except 5pm-9pm. Management must find a way to price the other hours to maximize profit and allow for peak usage times of facilities. Based on analysis, recommended hourly prices would then be $50 per hour regular, $80-85 peak.

Linear Demand Model

Regression Equation

Results:

Total Numbers:

Slope (b):

y-Intercept (a):

Regression Equation.....

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