Dearest trader,
I have a question that has been on my mind for a while. “How do you come up with those prices on the items and services you trade in”?
I ask this because I have been a government-licensed trader since January 2023 and I really struggle with pricing the items I have, for sale!
Photo credit: Huff Post
Please help me out with this.
Thank you in advance.
I ask myself this all the time! Specifically in the place I work. Today, one sausage roll was £1.50. Yesterday it was £1.20. When I first started two years ago, it was 50p. And I happen to do the ordering, so i know how much we order them for and how much profit we are making. Spoiler alert? It’s over 50%. Not to mention the coffee beans which are a markup price of 240%. It’s unbelievable what these ‘big’ companies think they can get away with.
😳😳 what?
I have an online business and I decide my product’s prices. And Pricing a product is one of the cornerstone decisions you’ll make as a business owner. One of the most important thing to consider is the value of the product.
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I checked out your article and found it to be an informative read! Your explanation of the various factors that go into pricing a product/service is helpful for anyone who’s struggling with this aspect of their business. Keep up the good work of sharing your knowledge with others!
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Pricing a product for sale has so many factors. A brick and mortar stores pricing has many more “behind the scenes” costs to factor whereas an online store has a different set of pricing needs. It really changes by the business and venue.
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I think the first place to start is to do a COGS analysis and go from there. It’s pointless to sell anything unless you know that the pricing will allow you to make some sort of profit!
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Lots to consider when I price products at my bakery – cost of goods, rent, insurance, equipment life and maintenance, employee costs, taxes, licenses, etc….. And do I want to make a profit or not. If butter doubles and stays up for some time – yes, I have to pass that on to my customers.
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I think there might be some pricing calculators out there that you might find in a google search. I’ve seen them for interior design services, that take into account what your competition is charging, as well as covering the operating costs, plus your desired profit margin. Congrats on getting a sales license! What are you selling?
👍🙏🏽 I’m majorly selling electrical appliances.
Things are extremely pricey nowadays. it’s unbelievable. I worry about my life after college.
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There should be a informative site that lists out the sources how a certain commodity is priced. Or we may not know that it already exists. Knowledge is power as they say.
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Loved your blog post on pricing strategies! Your tips on researching competition, identifying your target market, and periodically reviewing and adjusting your prices were so helpful. Thanks for sharing!
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It’s such a huge conglomeration of things. Demand, your minimum profit – there’s so much to factor in.
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This is something I often wonder. It seems impossible to have competetive rates with all the high costs of things lately. I wish you the best of luck on making it all work out!
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Ok, I don’t have a shop or something but I have friends who do and I asked the owners as well. If you buy the things, then, the price you bought and add some cents to it or maybe a couple of dollars. If something you made, this can be tricky and need to take sometimes to study the market first.
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That’s always a tricky subject. I sometimes works better to have the prices a bit higher but then give discounts, it gives you the chance to tweak the final price the customer pays. Not sure if that helps?
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I think comparing comparable services is probably a good idea. See what other folks charge in the area, and base your pricing on that.
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