‘How to Set eCommerce Prices’ – Small Business Trends
Shubhomita Bose says, “It’s a question every business owner has to ask himself at some point: what price do I sell my product at? Truth be told, pricing is tricky even for the most seasoned entrepreneurs.
Price your product low and you might receive a lot of sales but less profit. Price too high and you will end up attracting a niche audience that expects top quality.
It’s a fine balance, really and determined by the product you’re trying to sell.
How to Price Ecommerce Products
Depending on your situation, you may at times want to mark-up your products lower or higher. A simple formula may come handy to help you calculate your retail selling price.
Retail Price = [(cost of item) ÷ (100 – markup percentage)] x 100
To give an example, if you want to price a product that costs you $20 at a 45% markup, this is how you’d calculate your retail price”.
Comments are closed.
