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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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I recommend pricing from the top down, instead of the bottom up. The old-fashioned bottoms-up method uses the cost of goods as the starting point, add expenses and overhead and then profit.

Instead use the top down, get the maximum price possible, based on your offerings and your industry, then subtract costs and you end up with a profit margin.

Do not be afraid to charge appropriately. You can also have sales and give discounts to lower buying resistance - but you will have established the "value" of your product by publishing the higher list price.

Everyone likes to think they are getting a "good deal".

Your question prompted me to write this article: https://best4businesses.com/5-pricing-strategies-small-business

Getting your pricing right is crucial to our new business success.

There are several pricing strategies which are used for different types of industries, level of market competition and psychology.

When I launched my perfume business I used a combination of the standard cost plus overhead added profit and psychology strategies to determine my "list price". That means that this price was listed on my marketing materials, but sometimes I ran promotions, sales, and/or bundled other items to encourage sales. But my product value perception was of the higher price.

Good luck and happy entrepreneurship!


I would start with making a small market study (research) of competitor products that should give you an idea of the average people are making with similar items.

Then you can decide based on your expenses, your positioning strategy and your unique selling points your price and profit margins.

I would use various distribution channels to sell, e.g. ( website, amazon/B&N, etc). I think your price should be the same however you can do some targeted promotions on your website.

Michael N Francis

Anonymous User

For my point of view, your price is one of the best marketing message you send to a potential client. For example: If you sell a book in 150€, you're telling to the market: Hey, men and women with few incomes...you will never be able to buy my books, I'm not directing to u. U'r not my target client. What kind of clients are you directing to?
And about markup...it depends on your strategy. Is there scale economy? Is the same effort for u selling one book than selling two books? What costs do you really want to cover? What for?


A manufactured product usually has a rule of double then redouble costs for retail. Most makers underestimate costs, however.

Books are another animal altogether. Often authors give away electronic copies, worse pay for vanity printings that don't sell. An estimated 135 million titles are in print, more than whole nations might read in a lifetime. There are that many more titles waiting in the wings for a break. So books have no intrinsic value unless they somehow become popular first. As an author, you are selling the rights to your writing only, probably to a publisher. Being a publisher is an intense form of risky entrepreneurship, where you hope 1 in 10 printings you went on a limb backing becomes a hit. Self published authors have a lot of superior competitors to beat, and that takes guerrilla tactics, possibly a bookshelf of titles, too.

As previously mentioned, you can't focus on profits when you're struggling to get noticed. I'm aware of many authors, but not you.

Anonymous User

It seems you are selling books, but what kind of books? Are they extremely rare first prints? Did you write them yourself? Are they aimed at a niche market? What kind of market? One with money or not? Are they exclusive books? Is the quality of the print high and with lots of photo's? What do comparible books sell for? How high do you think the demand for your books will be?

It's very much about what you think people or companies will be willing to pay for them rather than a percentage or fixed number. If you will be selling low volume, there's little point in having a low markup, but you can afford to if you will be selling large volumes. Selling on your own website will increase the cost price of your product as you have increased development costs.


As you mention one must cover first of all the cost of production and marketing.
Consideration should be given to competitive pricing i.e. what the market can bear.Strategic pricing is key to product launch success as well as sustaining successful business. If you are a start-up business you may want to look at penetration pricing as opposed to differentiation pricing as an established business

Are you selling the book to make money or to spread the word about your thinking and expertise? The purpose will drive your outcome.


Hi Caitlin, This is a specialized are, in terms of understanding how the business works. Plus the marketing, however there are some common threads.

IN all the comments I have read, excluding the links or blogs that contributors have mentioned. One of the biggest aspects of costing that is so often not discussed, and there for may be over looked until it BITES YOU is TAX. Within your pricing model you do have to make allowance for the tax which you will have to pay at least once a year.

Something else to consider, and this will depend of the type of book,
You could consider selling both hard and soft "E" versions. at different pricing.
To promote your book you could also Give for Free a teaser like say 2 - 4 chapters, up to the point of interest or suspense.
That way they will get a feel for your style. If they like it they will follow you.
Set up an online "Book Club" where people can discuss the book with you.
You can them become more connected and approachable.
Set up a web subscription For free membership. That way you can communicate with your followers, And let them know what plot of book you are currently working on. Later you can offer the finished project at a reduced members/ subscribers price.

Maybe some of this can be used at the start to build up a following.
If you only have to be exclusive for 1 year, maybe Amazon or the like is a good way to test the water.


With anything that you are offering to sale, you need to see what your targeted audience is willing to pay and the value they may find in it. Do you have a sample targeted audience that you can have read your book (for free) and get some feedback from? If they really like it, then they could even give you permission to share that feedback in writing. Some published authors will even give a book away for free (for a limited period of time) for marketing purposes. Once people have become aware of you, your book and it's value, then you offer it "for sale!"

Another thing to do is to see how much other books, similar to yours, is selling for on Amazon and through B&N. As a new book, then offer it for a $ less than the others, if possible.


I know a man who said "I wouldn't pull my Camera out for under $500/day". He's now out of business because the truth is, we're now in a global market and the customers have a different mindset.

Certainly don't undervalue your services or products but be mindful of reputation. If you're just starting out, no matter what your friends and family think, you don't actually have a reputation.

I set a standard "double the cost" rule on everything (That I believe is a reasonable not too greedy price that's not ripping people off, just because they have no alternative,... heck I'd hate to overcharge for water in a desert) but double is nearly never the price. As an example:

My Apple costs $20 so I'll charge $40 and by the time that's not making me anything, it's time to invent a new apple. Now I've never sold apples before so (while I know my sales price is $40) I'll "reinvest in my own company" by offering a discounted price. 50% off means the customer see's $30 in a market full of $40 apples, you'll make sales and then you can gradually reduce that discount.
this becomes a sliding scale. $30 start, $40 peak, then while everyone else is increasing prices with inflation you stay at $40 (making your product look cheaper), all the while preparing to sell Banana's.
The big benefit of this is, you won't need to start off by discounting the Banana's because you'll already have a market share. And your Banana's will enter the market at the same profit line as all other professionals.


Starting with the cost-based approach is certainly a way to check that you're not losing money. The best approach to pricing is to first determine what customers are willing to pay. Find out what others are charging for books of similar type and set a pricing strategy. if you think that you can charge a premium go ahead. If you're new to the product genre and you want to grow quickly you may want to offer some kind of discount but don't reduce your price, just use a special offer.

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