How to justify the price

Every person at least once in their life had to sell something: a product or service. Price, according to the definition of marketing, is the monetary expression of value of goods. However, in order for the sale took place, it is necessary to justify the price to the buyer and convince him to buy the product.

Instruction

1. Calculate the cost of that is in each product. This measure is determined based on the specifics of the product or service. Cost reflects the costs of the seller for the production, procurement, storage and transportation of the product may indicate the amount of work and time costs. The cost also includes the costs for the preparation and start of production, the development costs of technology, salaries of staff, tax deductions, spending on advertising and competition.
2. Add benefit. Natural is the fact that cost product no one sells. Each seller in the cost of goods laid profit or benefit. Typically, to determine the financial part examines the market price, i.e. we study the prices of competitors with the same product. Advantage to higher cost of product in relation to the market can serve as the unique characteristics of products, exclusive, innovation, higher quality.
3. Include additional indicators. It is advisable to justify the price to take into account a range of variables such as the ratio of possible inflation, the coefficients of the complexity of the work. The cost can also influence regional price adjustments.
4. It must be remembered that the purchase of a product or service will take place only when the cost is below the value that the buyer receives with the purchase of the goods. Such benefits can be both tangible and intangible, but in any case, the purchase solves some problems and objectives of the client. Material values can be saving on acquisition, the profit from use of the goods in the future. Intangible benefits can serve as prestige, usability, security. In any case, you can reinforce the justification of the cost product value.