Setting prices

 

Sales prices are one area a lot of business owners struggle with. It shouldn’t be tricky if you take the following factors into consideration. They will help you set a range for the minimum and maximum price, you can then scale this according to current market conditions.

The price at which you sell should be based on the perceived value your product or service has to your customer. ”What is it worth to them? How much would they be willing to pay?”

Another consideration is around your competitors’ pricing. Benchmark the value of your offer against theirs. Your customers will!

At the same time, you also need to look at the costs you have incurred to bring it to market and ensure you are making enough profit. There are two ways in which to calculate this; mark-up and margin.

What is the difference between mark-up and margin?

Mark up is the percentage profit compared to the cost price.
Margin is the percentage profit compared to the sale price.

Try out our calculator to see how much profit you will make on each sale. We've included GST at 15% to make it even easier for you.

Margin / Markup Calculator

Cost Price $
Mark Up %
Margin %
Profit $
Price $ (ex gst)
gst $
Price $ (inc gst)