What is the term for setting a price for a new food item above the usual level, in excess of production and distribution costs?

The term for setting a price for a new food item above the usual level, exceeding production and distribution costs, is known as price skimming. This pricing strategy involves initially charging a high price for a new or innovative product, targeting customers who are willing to pay a premium for being among the first to access it.

Price skimming helps companies recover their development costs quickly and can lead to higher profit margins when the product is perceived as unique or highly desirable. As more competitors enter the market and the novelty of the product fades, the price may gradually be lowered to attract a broader customer base.

Understanding price skimming is crucial in marketing and product launch strategies, particularly in the food industry where consumer trends and demands can shift rapidly.