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How To Correctly Price Your Product

Business

Pricing is one of the things that determine the success of your business. If you want to be clear about what you want to achieve, then it is high time you came up with a good pricing strategy. The main reason why you are doing business is to make money. Therefore, you cannot afford to choose a wrong pricing strategy. The worst mistake that you can make is to believe that the price you are going to choose will drive your sales. In fact, the ability of selling your products is what will drive your sales. Therefore, it is wise to hire the right people to help you when it comes to marketing, while simultaneously adopting the best pricing strategies.


Underpricing

Canon T3i is among the most underpriced products in the world. Under pricing greatly affected the profit made by the manufacturer. Although there are very many investors who believe that this is the best step when the economy is down, this is not always the case. When pricing your products you need to know that accuracy is very important in any economic cycle.

Many investors tend to underprice their products in attempt to convince buyers that they are selling inexpensive products.

Remember that every consumer wants to believe that he or she is getting the worth of his or her money hence you need to take care of all the costs when it comes to pricing products.

Overpricing

A good example of overpriced products is the 1963 Pontiac Catalina – $ 48,000. Many people thought that the high price of this vehicle was a result of clerical error but it was never the case. Although it is a rare muscle car, the price is too high. Overpricing of this product had detrimental effects on buyers especially those who look at the products from competitors.

When you price your products beyond the desire of your consumers, you will reduce your sales. Consumers will think that you want to cover the expenses of your employees by overpricing.

A FEW SIMPLE STEPS

There are different methods you can use when it comes to pricing your products. To be very successful, you should combine different tools and understand that the main factor you need to take into account is your customer. The more you understand your customer needs, the better you will be positioned to offer them with the value of their money. Here are tips on how to price your products.

Step 1 - Understand Your Customer Needs

You need to do plenty of market research before deciding on the price of your products. This research can range from sending an email and conducting informal surveys. If you do not have money to spend on market research, simply look at various groups. You need to figure out the segment you are targeting as well as pricing before making your final decision.

Step 2 - Understand Your Costs

One of the fundamental tenets when it comes to product pricing is to understand your costs. You should cover all the expenses and then factor in the amount of profit you are likely to get at the end of the day. In addition, you should know how much you need to mark up your products and the price you should sell them in order to make more profits. The cost of the product is often higher than the literal cost of the item because includes the overhead costs of the same product.

The overhead costs of your products can include fixed and variable costs such as shipping as well as stocking fees among others. It is good to include all these cost when coming up with prices for your products. Failing to take into account all these factors is likely to lead to underpricing of your products, which will affect your sales.

Step 3 - Revenue Target

How much revenue do you want? You need to know your revenue target when producing, marketing and selling different products. Targeting your revenue can be very complex especially when you are dealing in a wide range of products. Start by estimating the number of units you wish to sell before the end of the day.

Divide your target revenue with the sum of units you are expecting to sell and you know the price that you should sell in order to attain your profit goals. In case you are dealing in different products, you should allocate the overall revenue you are targeting by the each of the products.

Step 4 - Competition

It is very helpful to a look at your competitors when pricing your products. After all, your customers will compare your price to that of your competitors before making their purchases. Find out whether the products are sold at prices comparable to yours. Only set higher prices if your products are highly priced when compared to those sold by similar vendors. It can be worthwhile to undertake a head to head comparison of different products with those of your competitors. While doing so, ensure that you use the net prices for accurate results.

Step 5 - Direction of the Market

Keeping track of the market direction will help you to determine the demand of your products. You should look at the long-term weather patterns and laws of the country, among other factors, before fixing the price of your products. In addition, you need to understand that your competitors are likely to respond to your prices by introducing new products to the market.

Raising and Lowering of Product Prices

When to raise Prices: It is wise to test new prices, offers, and combinations of these to help sell more products at better prices. You can raise your prices and then offer special customer service or unique bonuses to boost your sales. Ensure that you measure the decrease or increase in the amount of products you are going to sell as well as the gross profit. The best way to find out whether you have priced your products correctly is by looking at the sales volume.

When to Lower Prices: You are likely to miss your target audience by overpricing your products. You can decide to include discounts or give your customers free products to increase the volume of your sales.

This article was first published on StartUp Mindset.

6min read
Health

What Sexual Abuse Survivors Want You to Know

In 2016, I finally found my voice. I always thought I had one, especially as a business owner and mother of two vocal toddlers, but I had been wrong.


For more than 30 years, I had been struggling with the fear of being my true self and speaking my truth. Then the repressed memories of my childhood sexual abuse unraveled before me while raising my 3-year-old daughter, and my life has not been the same since.

Believe it or not, I am happy about that.

The journey for a survivor like me to feel even slightly comfortable sharing these words, without fear of being shamed or looked down upon, is a long and often lonely one. For all of the people out there in the shadows who are survivors of childhood sexual abuse, I dedicate this to you. You might never come out to talk about it and that's okay, but I am going to do so here and I hope that in doing so, I will open people's eyes to the long-term effects of abuse. As a survivor who is now fully conscious of her abuse, I suffer from post-traumatic stress disorder (PTSD) and, quite frankly, it may never go away.

It took me some time to accept that and I refuse to let it stop me from thriving in life; therefore, I strive to manage it (as do many others with PTSD) through various strategies I've learned and continue to learn through personal and group therapy. Over the years, various things have triggered my repressed memories and emotions of my abuse--from going to birthday parties and attending preschool tours to the Kavanaugh hearing and most recently, the"Leaving Neverland" documentary (I did not watch the latter, but read commentary about it).

These triggers often cause panic attacks. I was angry when I read Barbara Streisand's comments about the men who accused Michael Jackson of sexually abusing them, as detailed in the documentary. She was quoted as saying, "They both married and they both have children, so it didn't kill them." She later apologized for her comments. I was frustrated when one of the senators questioning Dr. Christine Blasey Ford (during the Kavanaugh hearing) responded snidely that Dr. Ford was still able to get her Ph.D. after her alleged assault--as if to imply she must be lying because she gained success in life.We survivors are screaming to the world, "You just don't get it!" So let me explain: It takes a great amount of resilience and fortitude to walk out into society every day knowing that at any moment an image, a sound, a color, a smell, or a child crying could ignite fear in us that brings us back to that moment of abuse, causing a chemical reaction that results in a panic attack.

So yes, despite enduring and repressing those awful moments in my early life during which I didn't understand what was happening to me or why, decades later I did get married; I did become a parent; I did start a business that I continue to run today; and I am still learning to navigate this "new normal." These milestones do not erase the trauma that I experienced. Society needs to open their eyes and realize that any triumph after something as ghastly as childhood abuse should be celebrated, not looked upon as evidence that perhaps the trauma "never happened" or "wasn't that bad. "When a survivor is speaking out about what happened to them, they are asking the world to join them on their journey to heal. We need love, we need to feel safe and we need society to learn the signs of abuse and how to prevent it so that we can protect the 1 out of 10 children who are being abused by the age of 18. When I state this statistic at events or in large groups, I often have at least one person come up to me after and confide that they too are a survivor and have kept it a secret. My vehicle for speaking out was through the novella The Survivors Club, which is the inspiration behind a TV pilot that my co-creator and I are pitching as a supernatural, mind-bending TV series. Acknowledging my abuse has empowered me to speak up on behalf of innocent children who do not have a voice and the adult survivors who are silent.

Remembering has helped me further understand my young adult challenges,past risky relationships, anger issues, buried fears, and my anxieties. I am determined to thrive and not hide behind these negative things as they have molded me into the strong person I am today.Here is my advice to those who wonder how to best support survivors of sexual abuse:Ask how we need support: Many survivors have a tough exterior, which means the people around them assume they never need help--we tend to be the caregivers for our friends and families. Learning to be vulnerable was new for me, so I realized I needed a check-off list of what loved ones should ask me afterI had a panic attack.

The list had questions like: "Do you need a hug," "How are you feeling," "Do you need time alone."Be patient with our PTSD". Family and close ones tend to ask when will the PTSD go away. It isn't a cold or a disease that requires a finite amount of drugs or treatment. There's no pill to make it miraculously disappear, but therapy helps manage it and some therapies have been known to help it go away. Mental Health America has a wealth of information on PTSD that can help you and survivors understand it better. Have compassion: When I was with friends at a preschool tour to learn more about its summer camp, I almost fainted because I couldn't stop worrying about my kids being around new teenagers and staff that might watch them go the bathroom or put on their bathing suit. After the tour, my friends said,"Nubia, you don't have to put your kids in this camp. They will be happy doing other things this summer."

In that moment, I realized how lucky I was to have friends who understood what I was going through and supported me. They showed me love and compassion, which made me feel safe and not judged.