Pricing a product is "probably the toughest thing there is to do," according to experts. Here's how to tackle it.
At Tomlibo, you decide the price of a product/service for sale. Please price the products competitively to create greater demand. Online shoppers do online and offline research and then compare prices before making a purchase decision. The lower the price of an item is, the higher is its possibility to get noticed and sold. If you are the cost leader for an item online, you are likely to see good customer response. We can also give you our opinion and recommendations on how to price products.
One of the secrets to business success is pricing your products properly. Price your products correctly and that can enhance how much you sell, creating the foundation for a business that will prosper. Get your pricing strategy wrong and you may create problems that your business may never be able to overcome.
Five major factors to consider when pricing;
- Know Your Customer
- Know Your Costs
- Know Your Revenue Target
- Know Your Competition
- Know Where the Market Is Headed
You can use the standard formula to work out the selling price;
A = Cost of Product/Material.
B = Expenses (such as; labour cost, storage cost, Tomlibo fees, delivery cost, payment processing cost and any other costs associated with that product).
C= Profit (how much money/margin do you want to make – use a standard industry average figure – if available).
[A + B + C] = SELLING PRICE
Other factors to consider are as follows;
- What the market is willing to pay.
- How your company and product are perceived in the market.
- What your competitors charge.
- Whether the product is "highly visible" and frequently shopped and compared.
- The estimated volume of product you can sell.
What kind of deals and promotions can I run or should offer at Tomlibo?
Online shoppers always welcome deals and promotions. Please think about offering value pricing for most products/services you are selling on Tomlibo and consider discounts, deals, bundling, quantity/bulk discounts etc. For off-season or excess inventory, you can offer deeper discounts.