When figuring out how to price your product for retail stores, you may encounter various obstacles. At Retailbound, we have established a couple quick tips to help you overcome these challenges and hopefully price your product for success!
1. Target Market
Before you can even begin to sell your product, you need to know who you are selling it to and what they are willing to pay. By analyzing your target market, you can see how much they have spent in the past on similar products to your own. This is a crucial step in deciding how to price your product. If you target market cannot afford your product, then they will not purchase it, resulting in loss for your company.
2. Include ALL Costs
Don’t forget about all those hidden costs! You need to be realistic when determining what you want your profit to be. It can be easy to leave out a variety of costs which do not seem obvious initially, but these will affect what you should price your product at. You do not want to underprice and end up losing profit, or even worse overprice and not sell at all.
3. Research the Competition
In order to remain competitive, it is imperative that you directly compare your prices to those of your competition. Whoever you are trying to sell to will definitely make the comparison to see if they think you are overcharging or not.
4. Assess the Market
The price of your product is not going to remain the same. Various external factors such as the price of your materials may be changing. It is important to be aware of any changes which may be happening in the market and consider these potential changes.