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How to Price Products??

  • avatar

    by: juanmsalazarcastro
    New SaleHoo Member
    8 posts

    How to Price Products??

    Posted 3 Jun 09 11:14 am.

    Hi Marc,

    Welcome and congratulations for your new position. I live in Brisbane as well by the way.

    Well at the moment I'm starting a dropshipping business. What I'm doing now is downloading all the photos and descriptions from my suppliers in order to place them in my website.

    These are the products I want to sell:

    - Pet accessories
    - clothing
    - jewellery
    - watches
    - antiques made in Gold
    - Guides to looking after and training pets
    - Car accessories
    - Home office products and related items (such as safes, guides to setting up a basic net working system)
    - Musical Instruments
    - Aquariums
    - Trains Fire-Engines
    - ATVs and Scooters

    My question is what price should I put on each category.

    I mean what how much should I earn for Musical Instruments,how much should I earn for watches, etc.

    Another question is, as an example, one of my suppliers offer Bracelets for less than $10, and the same supplier offer Bracelets for more than $60. I'm not sure if sell products that my suppliers offer for less than $20 or just sell those higher than $20.

    Please help me out with these doubts because It's something crucial in this business.

    Thank you very much and I look forward to hearing from you.

    Your friend,

    Juan Salazar.
  • avatar

    by: fudjj
    SaleHoo Staff
    2969 posts

    Re: How to Price Products??

    Posted 3 Jun 09 12:23 pm.

    Hi Juan, and thanks for you best wishes.

    Pricing is something you need to research on the selling platform you will be using, for example ebay.com.au

    It would be no good listing products $10.00 dearer than your competitors, so you need to see what your products, or products very similar are being priced at.

    Regarding the best stock to sell, again that question can really only be answered by research. You can try one of each and measure your response, but don't just measure it over a week.

    To accurate data you have to allow for market movements, so you could well need to research things like that over quite a few months, and that will of course be costing you in listing fees.

    The one big thing you do want to watch out for is your listing fees, just keep in mind that the dearer the product, the more you will be paying to list, so the more profit margin you will need to make to cover yourself.

    First things first, research your selling platform to gauge other product prices, that will tell you where your pricing model should be set.

    Just PM me if I can be of any further help.

    : )

    Marc Ransom

    Community Manager
    SaleHoo.com

    About the Community Manager

  • avatar

    by: stifterenterprises
    New SaleHoo Member
    2 posts

    Re: How to Price Products??

    Posted 21 Jul 09 4:34 am.

    Have you created your site yet? If so what is the web adress?
  • avatar

    by: haydee
    SaleHoo Master Member
    361 posts

    Re: How to Price Products??

    Posted 21 Jul 09 7:55 am.

    Hi Juan,

    There are two things that you need to consider:

    1. how much you got the product for
    2. any associated costs like fees to setup and maintain your website, etc

    The key is to make sure that the retail price of your product is enough to cover 1 and 2.

    The best strategy when pricing your products is 'research'. Fudjj pretty much covered this on his post. Know how much your competitors are selling the same product for. Remember most buyers shop around to get the best price. Here's an article that tackles retail pricing strategies:

    link hidden

    It should give you some ideas.

    Hope that helps! Good luck! :)
  • avatar

    by: bevsey123
    SaleHoo Master Member
    235 posts

    Re: How to Price Products??

    Posted 21 Jul 09 10:42 am.

    The simple answer is as much as you think you can get away with.

    You need to think about three factors:

    *Volume of Sales
    *The Market Price
    *Is it worth my while

    Don't get sucked into to price wars and lose all your hard work, someone will always be able to buy cheaper than you.

    A few Points of Sale to consider:

    *Free Shipping (Of course you build this into your price but customers love the fact they are getting something for free)

    *Customer Service

    *Returns Policy (A huge factor in eBay buyers desicions)

    *Your Listings - Are they plain and simple or colourful, more detailed and more eye catching that the competition.

    *Payment Methods - Buyers feel comfortable with PayPal or Credit Card processing.

    If you don't stray to far away from these points, your half way there.
  • avatar

    by: logical-insane
    New SaleHoo Member
    9 posts

    Re: How to Price Products??

    Posted 22 Jul 09 12:58 am.

    Can't remember where I got it from, but I still remember the quote and I believe in its logical simplicity.

    A product is worth what a customer is willing to pay for it. You just need to figure out what that is. If someone else decides to go under your prices, you'll just need to work with that as best you can.
  • avatar

    by: fudjj
    SaleHoo Staff
    2969 posts

    Re: How to Price Products??

    Posted 22 Jul 09 1:29 am.

    'A product is worth what someone is willing to pay for it'

    It's a quote we used in sales all the time, and is very true. The trick is to make the product as valuable as you can, that includes making an effective presentation of that product, as well as finding the best market.

    Another quote we had, 'The value of an ice block is far less to an Eskimo, than to a man with a martini'

    Ok, stupid quotes, but they put into simple terms what most ignore!

    Marc Ransom

    Community Manager
    SaleHoo.com

    About the Community Manager

  • avatar

    by: planes
    Forum Moderator
    843 posts

    Re: How to Price Products??

    Posted 26 Jul 09 3:07 am.

    A good resource is Terapeak.com.
  • avatar

    by: irene_salehoo
    SaleHoo Staff
    1951 posts

    Re: How to Price Products??

    Posted 29 Oct 10 12:12 am.

    Hi Juan,

    How about taking advantage of the differences in price and demand in different markets to make money. Here's more info on how you can buy low and sell high - http://www.salehoo.com/education/ebay-selling/ebay-arbitrage

    Cheers! :)

    Irene

    Customer Support
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