What strategy involves adding a mark-up percentage to costs to determine the selling price?

The strategy that involves adding a mark-up percentage to costs to determine the selling price is known as Cost Plus Pricing. This pricing method is straightforward as it takes the total cost of producing a product (including materials, labor, and overhead) and adds a predetermined percentage or fixed amount as profit.

With Cost Plus Pricing, businesses can ensure that all expenses are covered and that there is a consistent profit margin for every item sold. This method is particularly useful for manufacturers or retailers that have a clear understanding of their costs and want a simple formula for setting prices. It provides a level of certainty in financial planning, as the profit margin can be easily quantified.

The other pricing strategies mentioned do not involve this direct calculation of costs plus a mark-up. Value Pricing focuses on the perceived value of the product to the customer rather than strictly on costs. Promotional Pricing refers to temporary reductions in price to stimulate sales, and Demand Oriented Pricing adjusts prices based on consumer demand rather than a fixed mark-up. Each of these methods serves different purposes and can be beneficial in various market situations, but they do not specifically adhere to the Cost Plus Pricing formula.