Price is an important element of marketing mix due to the following reasons:
(i) It determines the sales volume and profit margin of the manufacturer/dealer.
(ii) It influences the competitive strength of a product.
(iii) It affects promotion and place components of marketing mix.
(iv) It determines the purchasing power and standard of living of consumers.
(v) Without pricing, there can be no marketing, as sales takes place after the buyer and seller agree on the price.