The pricing strategy for system security industry in Taipei district

• Main Authors: Kao, Kuo Feng, 高國峰
• Other Authors: 郭維裕
• Format: Others
• Language: zh-TW
• Online Access: http://ndltd.ncl.edu.tw/handle/91146520352148920423

碩士 === 國立政治大學 === 經營管理碩士學程(EMBA) === 100 === In recent years, the security services industry has been rapidly growing and become mature and keenly competitive through the consumers’ highly demand and supports from the government. Due to the huge variety of the of security services category, the model of business operations and strategy of margins are also different accordingly. In such circumstances, unfortunately, price reduction becomes one of the main strategies to win the competitiveness for most of the security services company in the market. In the current market, there are two major services category which are system security and on-site guardians. In terms of the nature of the services for these two categories are varied, the security services company basically operate only one single category. The system security requires huge capital investment in the initial stage to establish the application system and its growth ratio of profitability will become higher than the growth ratio of sales revenue after its client size reaches certain economic scale. The characteristics of system security are obviously based upon the intensiveness of capital, high density of technology and wide scale of application. The potential value of system security depends upon the number of clients which company possess. Therefore, the system security company has to consider more and put more efforts on the complexity of business operations, and which is one the key subject being studied. This research and study will be focused on the category of system security and Taipei district based upon two major reasons: one is the degree of the penetration of system security in the market and the other is Taipei is most competitive district in this industry. As mentioned, price reduction becomes the key strategy to gain the market share but this also results in the drastic dropping of profitability which forces the company to reduce the personnel cost. Such kind of cost reduction approaches also bring out the worse service quality and high personnel turnover. Thus the purpose of this study is to figure out the most feasible and applicable pricing strategy in such competitive market by using the general accounting concept of break-even methodology under the considerations of minimum regulatory capital requirement and the current operational practice. I hope that the findings of this study can provide the following suggestions to the industry and government: 1.The pricing strategy should not far deviate from the market norms。 2.The company should offer reasonable and legitimate compensation package to the employees. To make profits by lower down the personnel costs will cause the high turnover rate and bear the risks of violating the labor law. 3.The capital allocation must be carefully reviewed and allocated if the net profit is much lower than returns. 4.It is necessary to promote the concept of reasonable pricing to gain the acceptance of consumers. 5.There should be clear and crystal regulations to stipulate the liability and obligation of system security company.