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What should I consider when pricing my product?

I know that I need to at least make back what it costs to make, but how do I know how big of a markup I should take? Will it be different if I sell my books on my website vs in a store like Amazon or Barnes n Noble?

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My business is a service business: So, I look at competition first, do a thorough review in my space and region; then I look at my costs, base costs plus any subcontractor or materials. Then I estimate margins based on all my expenses (healthcare, office supplies, travel etc); I also use salary wizards to have insights on an FTE with my experience and depth of knowledge to know what they make annually.
Products: I wrote and sold books a few years back. Any other platform (ebay, amazon etc) all have percentages, so make an adjustment. You have shipping and handling costs, strongly recommend you combine into a flat rate. Managing by location (zip) is a nightmare. Pick an average and use that as your shipping and handling. Go to UPS or post office and find out what weight, materials, labor cost and postage from the nearest city to the furthest away, and pick and average.
Interviewing publishers help you in understanding the business. Books aren't moving like they used to, so be careful.


What people will pay for it. That's the only thing that counts. If you can't produce it for less than that and make your target profit, then you're in a losing proposition

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Also, if you are trying to sell on Amazon or any other market place, you need to take into considerations the fees associated with the price. Cost of Goods (COGS) should reflect a margin at least 45-65% above the cost so that there is wiggle room for promotional activities.


Pricing is as simple as what can you charge to make money? While you can look at competition to help set an idea - it's not cut and dry, charge what they charge. Your competition may sell at a different price because of recognition, or because of volume. You didn't specify your product, and there may be mroe considerations, but Amazon for example can sell at a slightly different price than other sites/stores, because of the volume of shoppers, and their purchasing power. They're able to make smaller margins on some goods, because they'll make it up selling different items elsewhere. Also, Amazon and Barnes and Noble may give you a false sense of competition and pricing because of this. Different books, will have different value to some buyers than others - and the more demand the higher that can be charged, as long as the buyers see value in that cost. You could charge less - - - but you'd have to know that you're trading that lower amount per item, for selling more items - otherwise in the end, you're just making less money. You could charge more, but then you're going to sell fewer of each - if you're way out of the 'value' spectrum. It really comes down to what is your value to customers, and can you meet somewhere in the middle?

Anonymous User

Depends on your positioning strategy, if your books and/or the services you give to the client is unique you can think in sell them in a high position if clients are willing to pay for it (let's say Apple strategy).

If your strategy is to enter into the market beating Amazon or BN you should compete also in prices (difficult task) then ensure that you cover all your fix , variable costs and a sufficient profit to not to kill your business by cash-flow disruption or whethever. You can also offer a very competitive price for the books if it is compesated with other business line (if you offer them).

Be careful to not cannibalize your product selling them with a very low price.


Always remember that at the time of a start up, never focus too much on markup. Just keep it to a level where you can sustain yourself without hitting your pocket for your marketing, promotional and sales activities.

Secondly selling on Amazon or B&N would be better than just selling it on your own website as the audience would be larger there. In any case promotional activities in any case would be important at this juncture.,

Anonymous User

When anyone starts a new business, it's only natural to look at the competition and plan a pricing strategy based upon this. But this has drawbacks. You're into a commoditised market place and therefore competing on price. Set yourself up as a specialist and you're into a different marketplace. So before you consider pricing your product, consider your pricing strategy. Then the next part of your question opens up a whole new world of possibility...


I have three books published. In this day, Kindle is the way to go. 95% (if not more) of my sales are Kindle related. Price it high enough to cover your cost and make some money and then utilize Amazon's "promotions". When I run a promotion, I tend to sell a lot of books! Do note, I write and sell books for charity, not as my primary means of income. Those truly in the field, might have other advice.

Here are links to my books if you want to check them out:





Hi Caitlin. The factors that are essential to pricing for us here at From Mother's Garden are:

What does it cost me to produce, package, and market this item?

What do others charge and what are people willing to pay for what I'm selling?

Would I be willing to pay this amount for my items? Are they worth this amount?

If I wouldn't be willing to pay the price I'm charging, I won't charge that price. If my costs to make the product are not covered by the price I'm selling the item for, I charge more. I am not so concerned with making a lot of money per sale as I am about making the sale at this point.

When you are new or relatively new, creating a following and return/repeat customers is the ultimate goal. Have you completed a cost-savings analysis? Completing mine helped me see that I needed to charge people more for my products and I made price adjustments based on what I saw in the analysis. The SBA has helpful tools on their site.

I hope that helped. :)


There's more strategy involved, particularly if you are on trying to develop a new market or are trying to create your "brand."

If you are talking about an eBook, you have to know the rules on who give you the best exposure and what their rules are. For example, if you go with KDP (Amazon) they'll give you some nice tools to promote but you have to be exclusive with them for a certain amount of time.

Good luck!

Anonymous User

Your targeted audience interest suppose to be number 1 thing to consider.
If you focus too much on the profits and your audience cannot avoid the price, you will end up not selling anything.

Consider it as you yourself see the same product. ask yourself this; "Can I Avoid it, Is the product worth the price?" If you are able to get positive answer then you have to consider other things that many people have mentioned here.

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