The importance of pricing power

This excerpt comes from a MIT Sloan Management Review article titled “Is It Time to Rethink Your Pricing Strategy?”

Renowned investor Warren Buffett has said, “The single most important decision in evaluating a business is pricing power. If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10%, then you’ve got a terrible business.”