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Situational Analysis of Hanson Production Company

Discuss about the Pricing Case Assessment Report.

Pricing assessment report or analysis provides a direction for a consistency and quality results in a price assessment. Hanson Company is a production firm with goals of expanding the art sector in the New York City. The company has a pricing strategy regarding the selling of the tickets including discounts offered, and opening prices. This report will carry out a pricing assessment for the company and will comprise of situational analysis table, the core problems and the contributing factors, the main assumptions, strategic alternatives that are pricing related and its analysis and summary of the rationale (Peter, 2010).

Situational analysis or SWOT table (combine internal and external environment, scan elements and represent specific information and quantifiable metrics)

The situational analysis of Hanson Production Company describes the internal and external environment of the company. The internal environment of the company comprises of Hanson Company's internal factors that affect the operations of the organization and the company has control over them. The internal factors that are contained in the internal environment comprise of the strengths and weaknesses of Hanson production Company (Peter, 2010). Strengths of the company are the internal factors that contribute to the success of the organization. For Hanson Company, its strengths comprise of having a brand name, large market share and ability to manage costs thus gaining a cost competitive advantage.

The weaknesses of the organization include its pricing strategies and marketing techniques that make it unable to obtain maximum revenues for the organization. The external environment of the company comprise of external factors that have an impact to the organization and which the organization has no control over (Peter, 2010). For Hanson Company, the opportunities include expanding its market to the New York City, achieving a competitive advantage in the production industry due to its brand name and quality of services, opportunities to attract highly talented staff or individual in the market. The company has threats in the new government policies in the industry that may affect the industry and competition from other production companies and organizations.

The elements of internal factors of Hanson Company include the employees such as Shen, the financial resources of the company and the physical resources such as the computers and buildings. The external environment elements include the audience, the theatre owners from which they rent and the competitors of the organization. The internal and external environment elements work together to enable Hanson Company achieves its goals of expanding the arts of New York City (Peter, 2010).

Internal and External Environments

Internal factors

SWOT analysis

Quantifiable metrics.


Financial resources


Internal systems


Large market share, adequate financial resources and brand name


Poor pricing strategies,

Revenue amounts, financial considerations ad performance, and number of customers.

External Factors



Owners of the theatre and the government policies.


Competitive advantage, opportunities to expand the market share.


New government policies, competitors from the industry

Revenue amounts, number of customers and financial performance.

The core problem of Hanson Company is Challenges that the company faces while determining ticket prices for opening days. Shen, who is also in charge of setting up prices experiences various limitations as fear of the expectations from the audience and availability of theater rooms depending with the size, despite the market research she conducts before setting the prices (Peter, 2010). Some of the contributing factors of the challenges in pricing include establishing higher prices that shun away the audience of Hanson production company, limited time to conduct market research, come up with appropriate prices for the tickets and rolling or reducing the prices to be lower than that which was initially set during ticket pricing.

Higher prices shun away audience who may be willing to buy the tickets from the company. This makes the company lose a certain amount of revenue that could be obtained from the lost audience.  In evaluating this alternative, the performance levels can be compared in terms of the profit of the company after implementation of the alternative (Peter, 2010). In limitations of time for setting the ticket prices, Shen had to set the prices for tickets set to eight weeks to the presentation and the theatre location had not been found, this creates a hectic environment that leads to poor price setting strategies (Baldacci et al, 2017). In assessing this alternative, the organization can determine if there is an improvement in the revenue of the organization after implementation of the alternative. Reducing the ticket prices after they have been set destroys the reputation of Hanson production Company towards the public and the company.

The Company should maintain the prices that were initially set to protect its reputation and increase its revenue. Determining the breakeven point of the company will assist to determine if this alternative is useful to the organization. Lack of awareness of the targeted audience and their expectations also make difficult to set the ticket prices and to find the appropriate theatres.

Some of the assumptions that have been considered in the pricing assessment of Hanson Company include the effects of the expenses and costs on ticket pricing; the assumptions of the internal and external factors such as competitor's prices have also been put in place (Peter, 2010). The case of Hanson Company has not put into consideration the pricing factors of the competitors in their pricing strategies. Some of the internal factors that have been put into assumption include the employee's salaries and wages and the working capital and expected returns of the company.

Core Problems and Contributing Factors

The pricing related alternatives include setting prices that are not very high for the audience, setting a stable ticket prices which will not be reduced in the process, coming up with appropriate timing strategies for conducting market research and setting up the ticket prices and obtaining adequate research for estimating the expected number of audience in order to come up with appropriate pricing strategies (Baldacci et al, 2017).

Setting prices that are not too high for the audience will attract more audience causing them to buy more tickets. This will increase the revenue of the company and maintain the loyalty of the audience who have bought the ticket thus obtaining a larger market share for the company. Reducing the ticket prices of the company after they have been set tarnishes the reputation of the organization and furthermore, makes it impossible to resume to the initial price. This can be solved by maintaining the stability of the set prices. This will enable the company to achieve a good reputation and earn more revenue than when the organization keeps on fluctuating the ticket prices. Having appropriate pricing strategies will enable Shen, who is in charge of ticket pricing to find out adequate information that is relevant for coming up with appropriate theatre locations and pricing strategies for the audience and the tickets respectively. Carrying out adequate market research will also enable the organization to have an analysis of the possible number of audience that is being expected in the event (Peter, 2010).  Their expectations can also be determined from the conducted research and come up with appropriate pricing strategies based on the decisions made.

Hanson production Company is a successful production Company but experiences several challenges in the setting up of the ticket prices. The company also has the internal factors and external factors that affect its operations in the production industry. The internal factors comprise of its strengths and weaknesses and the company can have control over them (Baldacci et al, 2017). On the other hand, the external factors comprise of the opportunities and threats of the company and which the company does not have control over (Peter, 2010). In order to address the pricing problems of the Company, the organization should come up with an appropriate implementation plan of the recommended alternatives. Coming up with the plan will enable the organization to formulate strategies and take corrective action that will enable the organization to achieve appropriate ticket pricing methods and strategies.

The organization can assess the performance of the company after implementation of the recommended strategies. This can be done by comparing the financial revenue of the company before the new pricing strategies were implemented and after they have been implemented. The best alternative chosen is carrying out adequate research to gather adequate information for pricing strategy (Peter, 2010). Revenues obtained after conducting an effective market research are higher as compared to before conducting the market research effectively.

The implementation table

Tasks to be implemented

Issue that is addresses

Period of implementation

Performance measurement

Adequate research time

Limited time to set ticket prices and knowing expected number of audience and their expectations.

Three months after the plan.

Revenues of the company, if they have increased or not.

Stabilizing prices

Reducing initial prices which tarnishes organization’s reputation

Five months after the plan.

Increased number of customers and the company’s revenue.

Setting favorable prices to attract more audience.

Higher ticket pricing that sends away some of the audience

Six months after the plan.

Revenue of the company in terms of profits and number of audience increased.



Peter Fermilgietti (2010). Hanson Production: Pricing for the Opening Day

Baldacci, R., Hill, A., Hoshino, E. A., & Lim, A. (2017). Pricing strategies for capacitated ring-

star problems based on dynamic programming algorithms. European Journal of Operational Research, 262(3), 879-893.

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