Analysis of Key Factors Affecting the Relationship of Lead-time Reduction and Premium Price: A Case Study of Two Companies Based on Hänichen (1995)

Abstract

Management accounting research has focused on price discounts, and there has been little discussion of premium prices. This research focused on the aspect of premium pricing, and investigated the possibility of lead-time reduction as a reason to raise the price. Since lead-time reduction can affect the price by responsing to customer orders promptly, this research examined the circumstances under which it leads to premium price, based on two cases. Using the framework of Hänichen (1995), it was found that multiple factors had an effect. We examined these factors comprehensively.