What Should You Charge?

Do you have a new product (or service) that you want to sell? Not sure what to charge? Maybe you have an existing product, but aren't sure if you're charging the right price for maximum profit?

You don't want to be too high that people won't buy, but you don't want to be too low if people would have paid more. It's a business decision that could mean the difference between success and failure. The low-price/high-volume business model may equal many orders, and the high-price/low-volume business model may equal a high profit margin. You need to find the perfect price that yields the maximum profit.

What are your costs per-unit?

This may vary from one situation to another. Don't forget to include YOUR time in the cost. When I do web design and programming, I like to give my clients a project cost, not an hourly wage, but sometimes I underestimate my time. I read once that you should always figure on about 4 times as much as you guestimated for a programming project. I'm finding out that that is probably pretty close.

What does your competition charge?

A good gage of what to charge your customers may be to check out what the competition is charging. This may seem obvious to you, but it is often overlooked. This is only a gage however. You don't know what their costs are and you don't know what their volume is.

Do you have a unique product or unique benefit?

If your product is unique it may have a higher perceived value. If someone wants your product and can't get it anywhere else, they'd be willing to pay you more.

What affects the customer's perception?

A price that is too low can cause a product to look cheap. And the reverse is also true which could be a good thing, but only to a certain point. If the price is too high, the customer just thinks you are trying to gouge them.

A price that is shorter appears less expensive. Thus $59 looks better than $58.99. Also a price that ends in 9 or 8 or 7 or 5 looks less expensive. Thus $9.97 is only 3 cents less than $10, but could mean the difference of whether the customer opens his/her wallet or not.

How do you find out what customers are willing to spend?

You need to find out what customers think of your product and how much they would pay for it. Make Your Price Sell (MYPS) is pricing software that will do the job for you.

Where can you find more pricing information?

Sign up for The Pricing Masters course. It's an intensive 5-Day e-mail course that shows you how to find the PERFECT PRICE for your product. To receive this course, send an email to tpmstraffic@sitesell.net. Please enter "MASTERS" (all capital letters, without quotes) at the beginning of the subject line or you will not receive the course.

There is whole lot more valuable pricing information in the free pricing manual included when you order MYPS.