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THE DATA IS ALSO USED FOR TRAFFIC FORECAST MODELS. THE MODELS ARE
NEEDED TO ASSESS THE IMPACTS OF LAND USE AND TRANSPORT SYSTEM
DEVELOPMENT ON TRAFFIC, FOR EXAMPLE, TO PREDICT CHANGES IN TRAFFIC
VOLUMES AND THEIR IMPACTS IN DIFFERENT POINTS OF THE TRANSPORT
NETWORK.
QUICK LOOK
1
AADT ESTIMATES ARE SUBJECT TO MANY SOURCES OF
VARIABILITY. THEREFORE, IT IS SUGGESTED THAT HISTORICAL AADT’S
BE REFERENCED IN ADDITION TO THE MOST CURRENTLY AVAILABLE
INFORMATION. CONSTRUCTION EFFECTS ARE UNAVOIDABLE WHEN
COLLECTING TRAFFIC DATA. IF POSSIBLE, TRAFFIC COUNTS ARE
SCHEDULED BEFORE A PROJECT STARTS OR AFTER IT IS
COMPLETED. IT IS IMPORTANT TO REMEMBER THAT CONSTRUCTION
AFFECTS TRAFFIC PATTERNS ON THE ENTIRE ROAD NETWORK;
ANOTHER REASON WHY IT IS VALUABLE TO REFERENCE HISTORICAL
TRAFFIC VOLUMES.
2
ITEM # 2: BONDED AND UNBONDED CONCRETE OVERLAYS
3
UNBONDED CRCP CONCRETE OVERLAYS MAY BE USED OVER CRCP, JOINTED
CONCRETE PAVEMENT (CPCD), OR JOINTED REINFORCED CONCRETE
PAVEMENT (JRCP). UNBONDED CRCP OVERLAY USES THE SAME DESIGN
PROCEDURE AS NEW CRCP PAVEMENTS. THIS USE OF UNBONDED CRCP
OVERLAY CAN BE CREDITED FOR CONTRIBUTING TO THE STRUCTURAL
CAPACITY OF THE EXISTING CONCRETE PAVEMENT AND RESULTS IN A
THINNER CONCRETE PAVEMENT DESIGN THAN REQUIRED FOR CRCP
CONSTRUCTED ON A NEW LOCATION.
4
PAST PROVEN PRACTICES (EXPERIENCE-BASED) THAT MAY NOT MEET
CONVENTIONAL ANALYTICAL DESIGN STANDARDS, BUT HAVE A PROVEN
PERFORMANCE TRACK RECORD.
5
WILL ALSO ESTABLISH THE FINAL AUTHORITY FOR PAVEMENT DESIGN WITHIN
THE DISTRICT.
6
ITEM # 4: TRAFFIC VOLUME
FOR TWO-LANE RURAL HIGHWAYS, THE DHV IS THE TOTAL TRAFFIC IN BOTH
DIRECTIONS OF TRAVEL. ON HIGHWAYS WITH MORE THAN TWO LANES (OR
ON TWO-LANE ROADS WHERE IMPORTANT INTERSECTIONS ARE
ENCOUNTERED OR WHERE ADDITIONAL LANES ARE TO BE PROVIDED LATER),
KNOWLEDGE OF THE DIRECTIONAL DISTRIBUTION OF TRAFFIC DURING THE
DESIGN HOUR (DDHV) IS ESSENTIAL FOR DESIGN. DHV AND DDHV MAY BE
DETERMINED BY THE APPLICATION OF CONVERSION FACTORS TO ADT.
DHV = (ADT)(K)
DDHV = (ADT)(K)(D)
7
DIRECTIONAL DISTRIBUTION (D). TRAFFIC TENDS TO BE MORE EQUALLY
DIVIDED BY DIRECTION NEAR THE CENTER OF AN URBAN AREA OR ON LOOP
FACILITIES. FOR OTHER FACILITIES, D FACTORS OF 60 TO 70 PERCENT
FREQUENTLY OCCUR.
NOTE: IF THE DIRECTIONAL ADT IS KNOWN FOR ONLY ONE DIRECTION, TOTAL
ADT MAY BE COMPUTED BY MULTIPLYING THE DIRECTIONAL ADT BY
TWO FOR MOST CASES.
LANE WIDTH
LATERAL CLEARANCES
FREE-FLOW SPEED
TERRAIN
DISTRIBUTION OF VEHICLE TYPE.
8
SERVICE FLOW RATE IS THE TRAFFIC PARAMETER MOST COMMONLY
USED IN CAPACITY AND LEVEL-OF-SERVICE (LOS) EVALUATIONS.
KNOWLEDGE OF HIGHWAY CAPACITY AND LOS IS ESSENTIAL TO
PROPERLY FIT A PLANNED HIGHWAY OR STREET TO THE REQUIREMENTS
OF TRAFFIC DEMAND. BOTH CAPACITY AND LOS SHOULD BE EVALUATED
IN THE FOLLOWING ANALYSES:
TRAFFIC SPEED
9
SELECTION OF DESIGN SPEED FOR A GIVEN FUNCTIONALLY CLASSIFIED
ROADWAY IS INFLUENCED PRIMARILY BY THE CHARACTER OF TERRAIN,
ECONOMIC CONSIDERATIONS, EXTENT OF ROADSIDE DEVELOPMENT (I.E.,
URBAN OR RURAL), AND HIGHWAY TYPE. FOR EXAMPLE, THE DESIGN SPEED
CHOSEN WOULD USUALLY BE LESS FOR ROUGH TERRAIN, OR FOR AN URBAN
FACILITY WITH FREQUENT POINTS OF ACCESS, AS OPPOSED TO A RURAL
HIGHWAY ON LEVEL TERRAIN. CHOICE SHOULD BE INFLUENCED BY THE
EXPECTATIONS OF DRIVERS, WHICH ARE CLOSELY RELATED TO TRAFFIC
VOLUME CONDITIONS, POTENTIAL TRAFFIC CONFLICTS, AND TOPOGRAPHIC
FEATURES.
10
ITEM # 5: APPLICATION OF DESIGN GUIDELINES
11
ELEMENTS. THE DIMENSIONS GIVEN IN THIS CHAPTER WILL BE REFERENCED
FOR MOST OF THE ROADWAY CLASSIFICATIONS.
12
AND THE METHODOLOGY FOR DETERMINING APPROPRIATE LENGTHS OF
NEED.
13
3R PROJECTS ARE THOSE WHICH ADDRESS PAVEMENT NEEDS AND/OR
DEFICIENCIES AND WHICH SUBSTANTIALLY FOLLOW THE EXISTING
HORIZONTAL AND VERTICAL ALIGNMENT. THEY DIFFER FROM
RECONSTRUCTION PROJECTS IN THAT RECONSTRUCTION PROJECTS
SUBSTANTIALLY DEVIATE FROM THE EXISTING HORIZONTAL AND/OR
VERTICAL ALIGNMENT AND/OR ADD CAPACITY.
DESIGN GUIDELINES
14
ITEM # 7: LANE
15
BICYCLES. PEDESTRIAN VOLUME DECLINES AS LANES WIDEN, AND
INTERSECTIONS WITH NARROWER LANES PROVIDE THE HIGHEST CAPACITY
FOR BICYCLES. AS LANE WIDTH DECREASES, TRAFFIC SPEED DIMINISHES.
ADVOCATES FOR SAFETY OF PEOPLE WALKING AND PEOPLE ON BIKES, AND
MANY NEW URBANISTS DISAGREE WITH TRADITIONAL THINKING IN TRAFFIC
ENGINEERING, SAYING THAT SAFETY AND CAPACITY ARE NOT ADVERSELY
IMPACTED BY REDUCING LANES WIDTHS TO AS LITTLE AS 10 FEET (3.0 M).
MOREOVER, WIDER TRAVEL LANES ALSO INCREASE EXPOSURE AND
CROSSING DISTANCE FOR PEDESTRIANS AT INTERSECTIONS AND MIDBLOCK
CROSSINGS.
THE MAXIMUM TRUCK WIDTH HAD BEEN 96 INCHES (2.438 M) IN THE CODE OF
FEDERAL REGULATIONS OF 1956 WHICH MATCHES WITH THE WIDTH OF EIGHT-
FOOT FOR SHIPPING CONTAINERS. THIS HAD BEEN INCREASED TO 102 INCHES
(2.591 M) IN 1976 WHICH EXPLICITLY STATES TO BE READ AS THE SLIGHTLY
LARGER METRIC 2.6 METRES (102.36 IN) WIDTH RESPECTING INTERNATIONAL
HARMONIZATION.[12] THE SAME APPLIES TO STANDARDS IN EUROPE WHICH
HAD INCREASED THE ALLOWABLE SIZE OF ROAD VEHICLES WITH A CURRENT
MAXIMUM OF 2.55 METRES (100.39 IN) FOR MOST TRUCKS AND ALLOWING 2.6
METRES (102.36 IN) FOR REFRIGERATOR TRUCKS. THE MINIMUM EXTRA SPACE
HAD BEEN 0.20 METRES (7.87 IN) AND IT IS CURRENTLY ASSUMED TO BE AT
LEAST 0.25 METRES (9.84 IN) ON EACH SIDE. FOR ROADS WITH A LOWER
AMOUNT OF TRAFFIC IT IS ALLOWED TO BUILD THE SECOND OR THIRD LANE IN
THE SAME DIRECTION TO AN ASSUMED LOWER WIDTH FOR CARS LIKE 1.75
METRES (68.90 IN), HOWEVER THIS IS NOT RECOMMENDED AS A DESIGN
PRINCIPLE FOR NEW ROADS AS CHANGES IN THE AMOUNT OF TRAFFIC COULD
MAKE FOR UNNECESSARILY INCREASED RISKS IN THE FUTURE.
16
ITEM # 9: LANE MARKINGS
SOLID WHITE LINE: REQUIRES YOU TO STAY WITHIN THE LANE AND ALSO
MARKS THE SHOULDER OF THE ROADWAY.
YELLOW LINES MARK THE CENTER OF A TWO-WAY ROAD USED FOR TWO-WAY
TRAFFIC. YOU MAY PASS ON A TWO-WAY ROAD IF THE YELLOW CENTERLINE IS
BROKEN. WHEN A SOLID AND A BROKEN YELLOW LINE ARE TOGETHER, YOU
MUST NOT PASS IF YOU ARE DRIVING NEXT TO THE SOLID LINE. TWO SOLID
YELLOW LINES MEAN NO PASSING. NEVER DRIVE TO THE LEFT OF THESE LINES.
17
ITEM # 10: LEVEL OF SERVICE
18
SUCH AS MERGING RAMP TRAFFIC OR LANE CHANGES, WILL CREATE A SHOCK
WAVE AFFECTING TRAFFIC UPSTREAM. ANY INCIDENT WILL CREATE SERIOUS
DELAYS. DRIVERS' LEVEL OF COMFORT BECOME POOR.[1] THIS IS A COMMON
STANDARD IN LARGER URBAN AREAS, WHERE SOME ROADWAY CONGESTION
IS INEVITABLE.
F: FORCED OR BREAKDOWN FLOW. EVERY VEHICLE MOVES IN LOCKSTEP WITH
THE VEHICLE IN FRONT OF IT, WITH FREQUENT SLOWING REQUIRED. TRAVEL
TIME CANNOT BE PREDICTED, WITH GENERALLY MORE DEMAND THAN
CAPACITY. A ROAD IN A CONSTANT TRAFFIC JAM IS AT THIS LOS, BECAUSE LOS
IS AN AVERAGE OR TYPICAL SERVICE RATHER THAN A CONSTANT STATE. FOR
EXAMPLE, A HIGHWAY MIGHT BE AT LOS D FOR THE AM PEAK HOUR, BUT HAVE
TRAFFIC CONSISTENT WITH LOS C SOME DAYS, LOS E OR F OTHERS, AND COME
TO A HALT ONCE EVERY FEW WEEKS.
19
DEVELOPMENT AND ADOPTIONS, SUPPORTING THE PLANNING PROCESS AND
ADOPT HIGHWAYS
HIGHWAY RECORDS, MAINTAIN ACCURATE RECORDS OF SHEFFIELD’S
HIGHWAYS
NEW WORKS TEAM, ARRANGE FOR AMEY TO CARRY OUT CHANGES TO THE
HIGHWAY NETWORK
OPERATIONAL PROCESSES, MANAGE SERVICE ACTIVITIES UNDER THE
STREETS AHEAD PROJECT
TECHNICAL, ENSURE WORK IS DESIGNED AND CARRIED OUT CORRECTLY
LAGAN OPERATIONS & MAINTENANCE LIMITED HAS BEEN SUCCESSFULLY
DELIVERING THE OPERATION AND MAINTENANCE OF ROADS FOR THE LAST SIX
YEARS. WE CURRENTLY OPERATE THE FERMOY AND LIMERICK PROJECTS ON
BEHALF OF THE CONCESSIONARIES IN A TERM CONTRACT ARRANGEMENT. WE
ALSO ASSIST LOCAL AUTHORITIES WITH THE MANAGEMENT OF THEIR ROADS.
TYPICAL RESPONSIBILITIES INCLUDE:
ROUTINE DAILY INSPECTIONS AND REPORTING OF THE ROAD AND ASSOCIATED
STRUCTURES, DRAINAGE AND FURNITURE
REPAIRS IDENTIFIED IN ROUTINE DAILY INSPECTIONS – BOTH TEMPORARY AND
PERMANENT
ENVIRONMENTAL MANAGEMENT – DRAINAGE, GULLY EMPTYING AND
SWEEPING, SLUDGE REMOVAL, PONDS MAINTENANCE, ROADKILL REMOVAL
AND DISPOSAL OF DEBRIS AND OTHER OBJECTS
LANDSCAPE MANAGEMENT – GRASS/SHRUB/TREE CUTTING, MANAGEMENT
AND WEED CONTROL
24 HOUR INCIDENT RESPONSE – ROAD INCIDENTS, INCIDENT REACTION
MANAGEMENT, LIAISON WITH EMERGENCY SERVICES, CLEARANCE OF
RESULTANT DEBRIS, TEMPORARY AND PERMANENT REPAIRS AND VEHICLE
REMOVAL
ELECTRICAL APPARATUS – LIGHTING/SIGNAGE, CLEANING AND LAMP
CHANGES, CLEANING AND MONITORING OF EMERGENCY ROADSIDE
TELEPHONES AND OTHER COMMUNICATIONS SYSTEMS.
FURNITURE AND SIGNAGE – CLEANING AND REPAIRS, BARRIER REPAIRS, ROAD
MARKINGS AND STUD REPAIRS
WINTER MAINTENANCE – MONITORING OF WEATHER CONDITIONS AND
TREATMENT DECISIONS IE. INTERPRETING WEATHER DATA FROM WEATHER
20
STATIONS, FORECASTS, ACTUAL CONDITIONS AND SOFTWARE, SALT
SPREADING TREATMENTS AND SNOW CLEARANCE.
21
TYPE OF FLEXIBLE PAVEMENT WEARING COURSE WHICH IS TYPICALLY USED
FOR HEAVILY TRAFFICKED ROADS
22
THE DESIGN STANDARDS OF THE AMERICAN ASSOCIATION OF STATE HIGHWAY
AND TRANSPORTATION OFFICIALS (AASHTO) ALLOW 1.5 SECONDS FOR
PERCEPTION TIME AND 1.0 SECOND FOR REACTION TIME.[2][3]
THE VALUES OF STOPPING SIGHT DISTANCE USED IN DESIGN REPRESENT A
NEAR WORST-CASE SITUATION. FOR DESIGN, A CONSERVATIVE DISTANCE IS
NEEDED TO ALLOW A VEHICLE TRAVELING AT DESIGN SPEED TO STOP BEFORE
REACHING A STATIONARY OBJECT IN ITS PATH. A GENEROUS AMOUNT OF TIME
IS GIVEN FOR THE PERCEPTION-REACTION PROCESS, AND A FAIRLY LOW RATE
OF DECELERATION IS USED. THE DESIGN SIGHT DISTANCE ALLOWS A BELOW-
AVERAGE DRIVER TO STOP IN TIME TO AVOID A COLLISION IN MOST CASES.
DRIVER PERCEPTION/REACTION DISTANCE IS CALCULATED BY:
DPRT = 0.278 VT (METRIC)
DPRT = 1.47 VT (US CUSTOMARY)
WHERE:
DPRT = DRIVER PERCEPTION-REACTION DISTANCE, M (FT)
V = DESIGN SPEED, KM/H (MPH)
T = BRAKE REACTION TIME, IN SECONDS
BASED ON THE RESULTS OF MANY STUDIES, 2.5 SECONDS HAS
BEEN CHOSEN FOR A PERCEPTION-REACTION TIME. THIS TIME
WILL ACCOMMODATE APPROXIMATELY 90 PERCENT OF ALL
DRIVERS WHEN CONFRONTED WITH SIMPLE TO MODERATELY
COMPLEX HIGHWAY SITUATIONS. GREATER REACTION TIME
SHOULD BE ALLOWED IN SITUATIONS THAT ARE MORE
COMPLEX.
BRAKING DISTANCE IS CALCULATED BY:
DMT = 0.039 V2⁄A (METRIC)
DMT> = 1.075 V2⁄A (US CUSTOMARY)
WHERE:
DMT = BRAKING DISTANCE, M (FT)
V = DESIGN SPEED, KM/H (MPH)
A = DECELERATION RATE, M/S2 (FT/S2)
ACTUAL BRAKING DISTANCES ARE AFFECTED
BY THE VEHICLE TYPE AND CONDITION,
THE INCLINE OF THE ROAD, THE
AVAILABLE TRACTION, AND NUMEROUS
OTHER FACTORS.
A DECELERATION RATE OF 3.4 M/S2 (11.2 FT/S2)
IS USED TO DETERMINE STOPPING SIGHT
DISTANCE.[4] APPROXIMATELY 90 PERCENT OF
ALL DRIVERS DECELERATE AT RATES
23
GREATER THAN THAT. THESE VALUES ARE
WITHIN MOST DRIVERS' ABILITY TO STAY
WITHIN HIS OR HER LANE AND MAINTAIN
STEERING CONTROL. ALSO, MOST WET
PAVEMENT SURFACES AND MOST VEHICLE
BRAKING SYSTEMS ARE CAPABLE OF
PROVIDING ENOUGH BRAKING FORCE TO
EXCEED THIS DECELERATION RATE.
STOPPING SIGHT DISTANCE (SSD) IS THE SUM
OF REACTION DISTANCE AND BRAKING
DISTANCE
SSD = DPRT + DMT
SSD = 0.278 VT + 0.039 V2⁄A (METRIC)
SSD = 1.47 VT + 1.075 V2⁄A (US CUSTOMARY)
24
"LIVABILITY," WHICH IS DEFINED AS DESIGNING ROADS TO FOSTER BROADER
COMMUNITY GOALS, INCLUDING PROVIDING ACCESS TO EMPLOYMENT,
SCHOOLS, BUSINESSES AND RESIDENCES, ACCOMMODATE A RANGE OF
TRAVEL MODES SUCH AS WALKING, BICYCLING, TRANSIT, AND AUTOMOBILES,
AND MINIMIZING FUEL USE, EMISSIONS AND ENVIRONMENTAL DAMAGE.[1]
GEOMETRIC ROADWAY DESIGN CAN BE BROKEN INTO THREE MAIN PARTS:
ALIGNMENT, PROFILE, AND CROSS-SECTION. COMBINED, THEY PROVIDE A
THREE-DIMENSIONAL LAYOUT FOR A ROADWAY.
THE ALIGNMENT IS THE ROUTE OF THE ROAD, DEFINED AS A SERIES OF
HORIZONTAL TANGENTS AND CURVES.
THE PROFILE IS THE VERTICAL ASPECT OF THE ROAD, INCLUDING CREST AND
SAG CURVES, AND THE STRAIGHT GRADE LINES CONNECTING THEM.
THE CROSS SECTION SHOWS THE POSITION AND NUMBER OF VEHICLE AND
BICYCLE LANES AND SIDEWALKS, ALONG WITH THEIR CROSS SLOPE
OR BANKING. CROSS SECTIONS ALSO SHOW DRAINAGE FEATURES, PAVEMENT
STRUCTURE AND OTHER ITEMS OUTSIDE THE CATEGORY OF GEOMETRIC
DESIGN.
25
ITEM # 15: ROADSIDE DESIGN, GUIDE RAIL, AND APPURTENANCES
26
ITEM # 16: SUBBASE COURSE CONSTRUCTION
IN HIGHWAY ENGINEERING, SUBBASE IS THE LAYER
OF AGGREGATE MATERIAL LAID ON THE SUBGRADE, ON WHICH THE BASE
COURSE LAYER IS LOCATED. IT MAY BE OMITTED WHEN THERE WILL BE ONLY
FOOT TRAFFIC ON THE PAVEMENT, BUT IT IS NECESSARY FOR SURFACES USED
BY VEHICLES.
SUBBASE IS OFTEN THE MAIN LOAD-BEARING LAYER OF THE PAVEMENT. ITS
ROLE IS TO SPREAD THE LOAD EVENLY OVER THE SUBGRADE. THE MATERIALS
USED MAY BE EITHER UNBOUND GRANULAR, OR CEMENT-BOUND. THE
QUALITY OF SUBBASE IS VERY IMPORTANT FOR THE USEFUL LIFE OF THE ROAD
AND CAN OUTLIVE THE LIFE OF THE SURFACE, WHICH CAN BE SCRAPPED OFF
AND AFTER CHECKING THAT THE SUBBASE IS STILL IN GOOD CONDITION, A
NEW LAYER CAN BE APPLIED[1]
UNBOUND GRANULAR MATERIALS ARE USUALLY CRUSHED STONE,
CRUSHED SLAG OR CONCRETE, OR SLATE.
CEMENT-BOUND MATERIALS COME IN MULTIPLE TYPES. MASS CONCRETE IS
USED WHERE EXCEPTIONAL LOADS ARE EXPECTED, WITH THICKNESS
USUALLY 100 TO 150 MILLIMETRES (4 TO 6 IN), AND OPTIONAL REINFORCEMENT
WITH STEEL MESH OR POLYMER FIBERS. OTHER CEMENT BOUND
MATERIALS (CBM), WITH LESS STRENGTH BUT ALSO LOWER COST, ARE USED.
THEY ARE RATED BY STRENGTH, FROM THE WEAKEST CBM 1 (ALSO FORMERLY
KNOWN AS SOIL CEMENT) THROUGH CBM 2 TO CBM 3, 4, AND 5, WHICH ARE
MORE SIMILAR TO CONCRETE AND ARE CALLED "LEAN MIX".
THE THICKNESS OF SUBBASE CAN RANGE FROM 75 TO 100 MM (3 TO 4 IN) FOR
GARDEN PATHS THROUGH 100 TO 150 MM (4 TO 6 IN) FOR DRIVEWAYS AND
PUBLIC FOOTPATHS, TO 150 TO 225 MM (6 TO 9 IN) FOR HEAVY USED ROADS,
AND MORE FOR HIGHWAYS.
LOW QUALITY SUBBASE MATERIAL, INCLUDING LARGE PIECES OF ROCK AND
CONCRETE, WHICH WAS HARDLY ACCEPTABLE HERETOFORE, CAN NOW BE RE-
USED WHEN CRUSHED IN-SITU WITH CONVENTIONAL MILLING MACHINES TO
OBTAIN A HOMOGENOUS GRAIN SIZE. IT MAY THEN BE TREATED NORMALLY
WITH HYDRAULIC BINDERS, AUGMENTED BY SPECIFIC POLYMER
FORMULATIONS. THE GERMAN ROAD TECHNOLOGY
PROVIDER ADINOTEC PROPOSES THIS PROCESS, WHICH IS ADAPTABLE TO
ALMOST ANY SUBBASE MATERIAL AND CAN NET MAJOR COST SAVINGS
WITHOUT CHANGES AS TO QUALITY AND LOAD BEARING CAPACITY.
27
ITEM # 17: VALUE PRICING
28
FOR CELL PHONES). GOODS WHICH ARE VERY INTENSELY TRADED (E.G. OIL
AND OTHER COMMODITIES) ARE OFTEN SOLD USING COST-PLUS PRICING.
GOODS WHICH ARE SOLD TO HIGHLY SOPHISTICATED CUSTOMERS IN LARGE
MARKETS (E.G. AUTOMOTIVE INDUSTRY) HAVE ALSO IN THE PAST BEEN SOLD
USING COST-PLUS PRICING, BUT THANKS TO MODERN PRICING SOFTWARE
AND PRICING SYSTEMS AND THE ABILITY TO CAPTURE AND ANALYZE MARKET
DATA, MORE AND MORE MARKETS ARE MIGRATING TOWARDS MARKET- OR
VALUE-BASED PRICING.
VALUE-BASED PRICING IN ITS LITERAL SENSE IMPLIES BASING PRICING ON THE
PRODUCT BENEFITS PERCEIVED BY THE CUSTOMER INSTEAD OF ON THE
EXACT COST OF DEVELOPING THE PRODUCT. FOR EXAMPLE, A PAINTING MAY
BE PRICED AS MUCH MORE THAN THE PRICE OF CANVAS AND PAINTS: THE
PRICE IN FACT DEPENDS A LOT ON WHO THE PAINTER IS. PAINTING PRICES
ALSO REFLECT FACTORS SUCH AS AGE, CULTURAL SIGNIFICANCE, AND, MOST
IMPORTANTLY, HOW MUCH BENEFIT THE BUYER IS DERIVING. OWNING AN
ORIGINAL DALÍ OR PICASSO PAINTING ELEVATES THE SELF-ESTEEM OF THE
BUYER AND HENCE ELEVATES THE PERCEIVED BENEFITS OF OWNERSHIP.
PRICE SHOULD BE CONTROLLED WITHIN THE VALUE OF THE BENEFITS THAT
ONE BUSINESS PROVIDES FOR ITS CUSTOMER, WHILE AT THE SAME TIME
CONSIDERING THE PRICE THAT THEIR COMPETITORS' CHARGE.[3] THUS,
PRICES ARE TO BE SET ACCORDING TO THE VALUE THAT THE BUSINESS
PROVIDES FOR ITS CUSTOMER. TO MAXIMIZE THE PROFITABILITY OF THE
PRODUCTS SOLD BY THE BUSINESS, THE BUSINESS HAS TO MEASURE THE
BENEFIT OF THE PRODUCT THAT THEY PROVIDE TO THEIR CUSTOMERS,
SURVEY THE CRITERIA FOR THE CUSTOMERS' BUYING DECISION (SPEED OF
DELIVERY, CONVENIENCE OR RELIABILITY, ETC.) AND ALSO IDENTIFY THE
VALUE OF THE BENEFITS PROVIDED TO THE CUSTOMER.
COST-PLUS PRICING[COST-PLUS PRICING IS AN APPROACH WHICH USES THE
TOTAL COST OF PRODUCING THE PRODUCT OR SERVICE AND ADDING SOME
AMOUNT TO ALLOW THE BUSINESS NEEDS TO MAKE A PROFIT.[1] FOR EXAMPLE,
IN A RETAIL STORE, A PERSON BUYS SOMETHING FOR $5, AND HE/SHE SELLS
IT FOR $10 TO CUSTOMER, THIS IS CALLED COST-BASED PRICING. HOWEVER,
THE WILLINGNESS FOR THE CUSTOMER TO PAY IS LIMITED BY THE BENEFITS
THEY CAN RECEIVE: "BENEFITS ARE NET BENEFITS, WHERE ANY COST THAT
THE CUSTOMER FIRM INCURS IN OBTAINING THE SOUGHT BENEFITS, APART
FROM PURCHASE PRICE, ARE INCLUDED" (ANDERSON AND WYNSTRA,
2010,31).[4] THUS, THE CUSTOMER-PERCEIVED VALUE IS DIFFERENT BETWEEN
THE NET BENEFIT THEY RECEIVED AND THE PRICE THE CUSTOMER PAID, THE
SUPPLIER WILL NOT MAKE ANY PROFIT IF THE PRODUCTS ARE SOLD BELOW
THE COST.
VALUE-BASED PRICING
VALUE-BASED PRICING IS DEFINED BASED ON THE VALUE THAT A PRODUCT OR
SERVICE CAN DELIVER TO A PREDEFINED SEGMENT OF CUSTOMERS WHICH
29
ARE THE MAIN FACTOR FOR SETTING PRICES (HINTERHUBER, 2008, 42),[5] AS
VALUE-BASED PRICING DEPENDS ON THE STRENGTH OF BENEFITS THAT A
COMPANY CAN PROVE AND OFFER TO THEIR CUSTOMERS. THUS, VALUE IS THE
MOST IMPORTANT DRIVING FORCE IN EVERY BUSINESS DECISION AS VALUE
FOCUSES ON THE PRICE THE POTENTIAL CUSTOMERS ARE WILLING TO PAY
BASED ON THE BENEFIT OFFERED BY THE BUSINESS.[1][6] FOR EXAMPLE, THE
COST FOR FIXING A PIPE AT A CUSTOMER'S HOME FOR A PLUMBER IS $17.50
WITH THE COST OF TRAVEL, MATERIAL COST AND AN HOUR'S LABOUR.
HOWEVER, THE PLUMBER MAY DECIDE TO CHARGE A TOTAL OF $50 TO BENEFIT
FROM THIS BUSINESS.[1][6] THUS, THE CUSTOMER MIGHT NOT BE HAPPY ABOUT
THE OVERCHARGED PRICE GIVEN BY THE PLUMBER, AT THE SAME TIME THERE
ARE POSSIBILITY THAT THE PLUMBER WILL LOSE THEIR CUSTOMER, SO IT IS
IMPORTANT TO MEASURE THE VALUE OF A PRODUCT BEFORE SETTING THE
PRICE TOO HIGH. ON THE OTHER HAND, IF THE COMPANY HAS A CLEAR-
DEFINED BENEFIT THAT GIVES YOU AN ADVANTAGE OVER THE COMPETITOR,
THE COMPANY IS ABLE TO CHARGE ACCORDING TO THE VALUE THAT IS
OFFERED TO THE CUSTOMERS. THUS, THIS IS A VERY PROFITABLE APPROACH
AS IT CAN BREAK OFF POTENTIAL CUSTOMERS WHO ARE DRIVEN ONLY BY
PRICE AND ALSO ATTRACT NEW CUSTOMERS FROM COMPETITORS. EXAMPLE,
STARBUCKS RAISED PRICES TO MAXIMIZE PROFITS FROM PRICE INSENSITIVE
CUSTOMERS WHO DEPEND ON THEIR GOURMET COFFEE WHILE LOSING
CUSTOMERS WHO WANTED CHEAPER PRICES TO MCDONALDS.[7]
COMPARISON WITH COST-BASED PRICING
A FEW FACTORS THAT AFFECTS THE WILLINGNESS OF THE CUSTOMER TO PAY
A CERTAIN PRICES, FOR EXAMPLE, THE DIFFERENCE OF NEEDS BETWEEN
COUNTRIES, INDIVIDUAL CUSTOMERS NEEDS AND WANTS, AND THE USUAL
CUSTOMER FACING DIFFERENT OCCASIONS (ACTUAL AND PRESENT NEEDS),
HENCE A PLAN TO SUIT ALL TIME VALUE-BASED PRICING IS IMPOSSIBLE.
HOWEVER, BY FOCUSING AT AN EXTREME WAY MIGHT LEAVE CUSTOMER WITH
A FEELING OF EXPLOITED, LEAVING NEGATIVE RESULTS TOWARDS THE
COMPANY. HOWEVER, IN LONG TERM, PRICES BASED ON VALUE-BASED
PRICING ARE ALWAYS HIGHER OR EQUAL TO THE PRICES TAKEN FROM COST-
BASED PRICING, BUT IN ANOTHER WORDS, IF THE PRICES ARE LOWER,
CUSTOMER MIGHT THINK THAT THE ACTUAL VALUE PERCEIVED BY THE
CUSTOMER IS LOWER THAN THE COST OF PRODUCING THE GOOD PLUS A
PROFIT MARGIN, COMPANIES WILL NOT BE INTERESTED TO PRODUCE AND
SELL THE PRODUCT AT THAT PRICE IN LONG TERM. DESPITE BEING DIFFICULT
IN IMPLEMENTATION OF BOTH PRICING TECHNIQUES ON COMPANIES, THERE
SHOULD BE CONSIDERATION OF VALUES ON PRODUCTS AND MARKET
POSITIONING BROUGHT OUT TO THE CUSTOMERS ON EARLY STAGE
OF PRODUCT DEVELOPMENT.
30
ITEM # 18: PEDESTRIAN & GREENWAY MASTER PLANNING
32
ITEM # 19: ROAD TRAFFIC SAFETY PLANNING
33
ITEM # 20: METROPOLITAN TRANSPORTATION PLANNING
34
HIGHWAY, BICYCLE, PEDESTRIAN, AND ACCESSIBLE TRANSPORTATION) TO
MEET THE REGION’S ECONOMIC, TRANSPORTATION, DEVELOPMENT AND
SUSTAINABILITY GOALS – AMONG OTHERS – FOR A 20+-YEAR PLANNING
HORIZON, WHILE REMAINING FISCALLY CONSTRAINED.
35