Pricing in your business can take a long time.
First you weigh up all the strategies you could use. Then you fiddle around with a few dollars more or less until finally you arrive at a price only when you don’t get an immediate sale. Then you go through the whole process again.
If you are a business that quotes for business, it’s not always as simple as determining how long the job will take as you need to factor in other jobs on at the time, cash flow, and the potential for more work with the client later.
I spoke live on Facebook yesterday (watch it here) with a broad overview of all things pricing.
Below I give you a basic process to follow for you determine a price for your products.
Find attached an outline of some different pricing strategies, their pros and cons and when to use them. (See here: Pricing Strategies)
And finally, because I love a process, and see them as a way to stop procrastination and over-thinking, I’ve outlined some steps to follow which should put you on the right path to pricing success.
Step one: revisit your values
I always recommend starting with your brand values. If you aren’t solid on these already, listen to my thoughts on them here.
Step two: list some key details
Then it’s time to put pen to paper and write down:
- Your goals for this product (different products may have different goals)
- The cost to produce one item
- Additional overhead costs
- The prices charged by your competitors
- The financial situation of your target market
- The quantity you are able to produce
Step three: choose the best strategy for your product
Armed with that valuable information, you can then work through the different pricing methods.
I have made a summary and will send it out in my newsletter next week. Want it now? Email me at hello(at)breadbudgetingservices(dot)com.
And yay, you have your first draft of a price for your products!
Have you followed a process for your pricing? Or do you just wing it and see?
Have a great weekend everyone!