One of the primary objectives of every business is to maximize its profit and setting price is one of the principal tasks of marketing and finance manager. In that, the price of a product or service often plays a significant role in that products and services success, not to mention in a company’s profitability.

          Pricing policies for every establishment plays an important role on the level of profitability. Most private enterprise adopts pricing policies that maximizes profits unlike their public counterparts. In public enterprises government interferes in their pricing policies hence their poor performance (Igwemma 1999).

          Pricing police as an instrument to achieve this objective should be formulated in such a way as to maximize the sales revenue and profits. However, pricing policy refers to how a company sets the price of its product and services based on costs, value, demand and competition or how a firm uses pricing to achieve its strategic goods such as offering lower prices to increase sales volume or higher prices to decrease backlog.

          Generally, products are said to posses utility if they are capable of satisfying human wants and needs. Utility is often measured in terms of value and when such values are expressed in monetary terms, they become the price of the product. In fact, price is the value placed on something. What someone prepared to give in order to gain something (Inyanga, 2013).

          The importance of price to producers and consumer cannot be over-emphasized. Price is a distractive element of the marketing mix for the producer, because it is the only one that generates revenue. Price is also important to the producer because it provides the basis profit (Inyanga, 2013:159). Also, a producer’s goal on profit maximization is only attainable with a good pricing policy for a product. After all, the major aim of all marketing and merchandizing activities is to sell goods and services at a price that will cover production lost and still provide for reasonable profit to the businessmen (Ebue, 1996).

          On the other hand, consumers aim at maximizing satisfaction derived by consuming a production. To maximize satisfaction, the consumer is going to weigh up those promises against the price and decide whether it is worth paying (Inyanga, 2013). Also, ensure that the price of goods and services are not considered too high. As a matter of fact, consumers react to changes in price through product demand. According to Stanton, (1998:122), consumers normally agitate against product price reduction. However, the extent to which they react to price increase depend on certain factors (Elsie, 1997).

          Pricing policies significantly affect demand for consumer goods such as alcoholic drinks. This is as a result of the existence of various brands that can only be substitute for each other. Thus, in fixing his selling price, the marketing manager must bear in mind the need to achieve the profitability objectives which has been seen for the product as well as the price which the consumer is likely to be prepared to pay (Elsie, 1997). The producer must also ensure that the price upon which he decides is not higher than that which the consumer is prepared to pay for the product. Furthermore, having once settled on a price should not change too soon regardless of the possible fluctuation in cost or in market situation. This is because, consumer are likely to express their dissatisfaction through product demand. It is against this background that the study is set to examine the impact of pricing policies on the purchasing and consumption of alcoholic drinks in Nigerian Breweries Plc Aba.