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?
Use a process like Real Estate agents do when doing an analysis on home values. They look at all the homes in an area and then determine one by one, is their house better or worse than another. Your house must sell for than homes that are better, but more than homes which are worse. Eventually you come up with a happy medium. Example, if your product was a treadmill, I'd look at 20 different treadmills and there prices, side by side. Then find out which one are closest to yours, and then one by one ask your self 'is my product better or worse then this one?" If yours is better. then you should be able to get more money. When you see your product is inferior you should expect to get less. Find the middle point. Bottom line, if the marketing is there and you're not selling. you probably overpriced yourself. I hope that helped.
Things to consider when pricing a product
Whether you are starting out or starting over, here are five factors to consider when pricing your products and services.
Costs. First and foremost you need to be financially informed. ...
Customers. Know what your customers want from your products and services. ...
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Chances are, you have a unique product, at least in some way. However, that said, you'll also likely have competition to compete with who make similar products or offer similar services.
The more unique the product/service, the easier it is to put it into its own price category. For example, if it's a handblown pendulum light, it's so unique (one of a kind!), you can price it as you wish. However, if you graphic design services or website design, there will be similar businesses in your league. What can you do to create your OWN unique brand? What twist can you spin, using your traits, gifts, talents, on your brand to put it further or completely into its own league? The more unique your product, the more flexibility you have in terms of pricing choice.
Most importantly, know your worth! If, for instance, it's a product you created yourself, it's imperative, when pricing your product or service, to feel equality between the "giver" (seller) and "receiver" (buyer). If you don't think you're charging your worth or value, you'll keep attracting a lack of abundance because your customer will "feel" that sense of "unworthiness", too. Your customer has to feel as though what you're offering is worth the "price tag."
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You should know the purchasing capacity of the people who are going to become your customers, If you have priced your product without knowing your customers' purchasing capacity then it will not be a good thing for your business. To know this you can do a little survey in your area with product detail. You can ask the people directly by word of mouth, It will make a good impact on your customers.
I think you must take care in mind the total worth of the product plus the expenditure you've made on the product individually. Also, you need to take care that the price should be reasonable enough to reach the targeted audience.
I think the first thing you need to do is to do a market research. Find the existing book in the market, whose content related to yours and think about your targeted audience. I hope that this thing will be helpful in pricing your product.
Before you set your pricing, work out the costs involved with running your business. These include your fixed costs and your direct costs.
Know what your customers want from your products and services.
Where do you want to be in the marketplace? Do you want to be the most expensive, luxurious, high-end brand in your industry, the cheapest, beat it by 10% brand or somewhere in the middle?
What are they charging for different products and services? What inclusions and level of service are they offering for those prices? What customers are they attracting with their pricing? And how are they positioned in the marketplace?
How much profit do I want to make?
Hope this help!
How I do it, is my clients pay via bank transfer, the contract states due and payable in advance of the monthly services. My contracts also state I own all creative, content, copyrights, et all, until the term of the contracts expires and is paid in full.
If they don't pay, I require everything to be deleted in violation of the above terms.
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".