Advice 1: How to set the price

Entrepreneurs who start their business sometimes face a difficult situation. You bought a trial consignment of goods, but also do not know very well your capabilities as a seller and don't know if I can implement it totally or some part will remain unsold. In addition to the ability to sell at first, you will need to correctly set the price of the product.
In addition to the ability to sell at first, you will need to correctly set the price of the product
To set the price necessary to spread out the concept of "price" on the economic pillar. Structurally, the price of each item is the sum of all of your costs:
• related activities (rental, taxes, utilities, salaries, etc.);

• costs for the purchase of goods for resale;

• also contains a certain percentage of the profits that you expect to receive.
Thus, if you manage to sell a certain amount of product at a given price for the month, then the month can be considered commercially successful.
Then you should define the margin. If we continue our example from trade, the margin is a premium to the price of purchase of each item, through which you will be able to pay the associated activities costs and make a profit. In practice, the retail trade was some average indicators of the value markups that depend on groups of goods:
• The average markup on food is 25%;

Mark-up on clothes and shoes – 50 to 100%;

• The mark-up on small Souvenirs, and jewelry from 100%;

• Markup on auto parts is in the range of 30-60%.
Knowing these figures, you will be able to set a price for your product, the relevant market.
After the first month of trading keep all your expenses and incomes in a single report for yourself. If you were able to realize planned volume at a good price, to pay all costs incurred and to let small, but the profit calculation was performed flawlessly. If to achieve the planned results did not succeed, analyze the cause and you may slightly reduce prices and will be able to find what can be done differently and more efficiently.

Advice 2 : At what price to sell their goods?

If you have something to sell or want to sell, then you will sooner or later the question arises: at what price I can sell? What affects the formation of the final cost of the goods? Will there be a demand for this product for the price?
At what price to sell their goods?

The cost of the product is the amount of money that you are ready to leave the buyer for a particular product or service. The main thing in education rates is to understand that the price will never be stable. It is influenced by many factors. The main factor that has had an impact on the price of goods is the cost price of the product itself. No one will sell goods to their own detriment.

Many sellers seek to increase their profits only by reducing the cost of production of the product, or are looking for the possibility of lower wholesale prices. Remember that reducing production costs will lead to lower quality, which means, subsequently you will have less buyers.

Also an important factor to determine the cost – it offers the other sellers on the product. If the price of the commodity will be higher than in another store, then buy it, almost no one will. Although it is believed that the higher the value of the goods, the more it will buy. The psychology of many consumers suggests that the more expensive the product, the better it is and better. In addition to market pricing and is the maximum possible price for the goods set by the state. Be sure to check before selling, what is the maximum value you can set for the goods in accordance with the law.

How to use the cost of goods to increase their profits? The first and probably the most important way – is to reduce the cost of production. Or, in simple terms, reducing the cost of purchasing the goods. The main thing is not to overdo it. Remember that the cheaper the item cost, the worse the quality, and this may have a negative impact on the number of sales of such goods.

If you have narrow store that specializes only on a certain group of goods, then it makes sense to produce a better offer. For the cost, it will be slightly more expensive than ordinary goods, but for this product you can ask for and a great price, because here will play the role of quality for the consumer. The buyer will be ready to leave you more than at another store, but in return he will expect a quality service or product.

Another important factor influencing formation of the cost of goods – it offers the other sellers, and competitors. Usually in this case the price is calculated as the average number between the minimum and maximum price of goods in your city or area.

These are the main factors affecting the cost of goods, remember that to attract more buyers is to arrange any sales or best deals, because many customers are looking for proposals which will be beneficial for them.

Is the advice useful?