If you’re in a pickle about pricing, read on.
You may be struggling to accurately price your product or service, because either you’re completely unsure of where to start, or you don’t have enough faith in your abilities. So how do you go about it?
✨ First: check out the competition and what people are already selling these things for. Not to undercut them, but giving you a range of pricing to give you an idea.
✨ Second: include ALL your expenses. This is a biggy. When making a cake for example, you may readily think of the flour or other ingredients you need to make it as well as any boxes or boards. But what about the electricity to light the room, to power your appliances, the appliances themselves, how often may they need to be replaced? That cost should be included. What about any delivery services you may need to include? Your own fuel? 𝑨𝒏𝒅 𝒎𝒐𝒔𝒕 𝒊𝒎𝒑𝒐𝒓𝒕𝒂𝒏𝒕𝒍𝒚 𝒚𝒐𝒖𝒓 𝒕𝒊𝒎𝒆. 𝑯𝒐𝒘 𝒎𝒖𝒄𝒉 𝒊𝒔 𝒕𝒉𝒂𝒕 𝒘𝒐𝒓𝒕𝒉 𝒕𝒐 𝒚𝒐𝒖? 𝑯𝒐𝒘 𝒎𝒖𝒄𝒉 𝒅𝒐 𝒚𝒐𝒖 𝒏𝒆𝒆𝒅 𝒕𝒐 𝒄𝒐𝒗𝒆𝒓 𝒚𝒐𝒖𝒓 𝒃𝒂𝒔𝒊𝒄 𝒍𝒊𝒗𝒊𝒏𝒈 𝒄𝒐𝒔𝒕𝒔? 𝑫𝒐 𝒚𝒐𝒖 𝒘𝒂𝒏𝒕 𝒔𝒐𝒎𝒆 𝒆𝒙𝒕𝒓𝒂 𝒕𝒐 𝒃𝒆 𝒂𝒃𝒍𝒆 𝒕𝒐 𝒃𝒆 𝒇𝒊𝒏𝒂𝒏𝒄𝒊𝒂𝒍𝒍𝒚 𝒔𝒆𝒄𝒖𝒓𝒆? This can help you come up with your ideal “hourly rate”.
✨ Third: you want to take into account what, if any, profit you want to be putting back into your business, either as a reserve for quiet times, or for research & development later on.
✨ Fourth: as a side point, get other opinions on your product or service. Before you decide to sell it to the masses, send pictures or tasters to family and friends – ask them how much they would expect to pay for something like that. This is a great guide into how much they value your product. But just make sure to account for any bias.
✨ 𝑨𝒏𝒅 𝒂𝒃𝒐𝒗𝒆 𝒂𝒍𝒍 𝒓𝒆𝒎𝒆𝒎𝒃𝒆𝒓 𝒕𝒉𝒆 𝒈𝒐𝒍𝒅𝒆𝒏 𝒓𝒖𝒍𝒆 𝒐𝒇 𝒄𝒐𝒔𝒕𝒊𝒏𝒈: 𝒊𝒕 𝒊𝒔 𝒂𝒍𝒘𝒂𝒚𝒔 𝒆𝒂𝒔𝒊𝒆𝒓 𝒕𝒐 𝒍𝒐𝒘𝒆𝒓 𝒚𝒐𝒖𝒓 𝒑𝒓𝒊𝒄𝒆𝒔 than 𝒓𝒂𝒊𝒔𝒆 𝒕𝒉𝒆𝒎 ✨
These steps will help you set prices that are not only fair to your customers, but also fair to you.
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