EFFECT OF EXCHANGE RATE ON PRICING IN BUSINESS OPERATIONS OF SMEs IN ENUGU STATE
Keywords:
Exchange rate, Pricing, Business, Operations, SMEsAbstract
This work is on the effect of exchange rate on pricing in business operations of SMEs in Enugu state. Specifically, the objectives were to determine the effect of base currency on cost-based pricing in business operations and ascertain the effect of counter currency on value-based pricing in business operations of SMEs in Enugu state. The population of the study comprises two hundred and four (204) Manufacturing firms situated in Enugu State Nigeria and are registered under Manufacturing Association of Nigeria, total of seven (7) manufacturing SMEs in the Enugu State were selected. A total number of staffs from the seven selected manufacturing firm is 1360. Linear regression analysis was utilized to test the hypotheses of the study. The statistical tool used for the analysis is the statistical package for social sciences (SPSS) version 26. The findings of the study revealed that base currency does have significant effect on cost-based pricing in business operations of SMEs in Enugu state. counter currency does not have significant effect on value-based pricing in business operations of SMEs in Enugu state. The study concludes that changes in the exchange rate of the base currency can have a direct impact on the cost of inputs for SMEs, which in turn affects their pricing strategies, Value-based pricing is determined by factors such as customer perception, brand image, and competitive positioning, rather than exchange rate fluctuations. The study among other things recommended that SMEs should emphasize the unique value propositions of their offerings, such as quality, features, or customer experience, rather than solely relying on exchange rate fluctuations
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