Pricing

Why do some firms deliberately lose money, in order to make money? A loss leader is bait and hook tactic used by several firms that looks to lure customers into their stores or in their platforms with the expectation that they will make a profit off of the customer on other products or over the long-run.

When introducing a new product to market, one of the toughest decisions is how much to charge for the product. We look at some commonly used approaches to pricing a product.

Pricing models are the basis for accepting many sales. Pricing models present us with a picture of total product costs and the margins we can expect from future sales. Due to the importance of these documents, accuracy and detail is of the utmost importance.

How much should I charge for my goods and services? That's a question that plagues many an entrepreneur. We offer some tips on finding the right price for your wares.

How much should I charge for my products and services? Focus on positioning instead of pricing, and you'll find you're in a great position to raise prices and grow your business.

Every customer loves a good deal, but new and small businesses often are ineffective in managing price promotions and discounts effectively. A good price promotion and discount program incentivizes new customers to try and use your product, but keeps current customers paying regular price by choice and helps to increase your long-term profits.

Pricing products and services plays a role for promoting and sustaining your business. Pricing products low is the almost a default option for most business owners, but it isn't recommended. Here are five ways how pricing low affects your business.

Setting prices for the entrepreneurial business requires an understanding of the market and a measure of expenses. An entrepreneur may also benefit from the guidance of a mentor or financial expert.

Pricing decisions for a firm can strongly influence the profits that a firm reaps; however, finding the right price and pricing strategy can be a challenge. The best way to start with determining price is to take into account not only your costs, but your competitor pricing, and the difference in value your product offers compared to the competition.

The difference between wholesale and retail prices is going to determine how much of a profit you make. So how do you set your retail prices so that you are reasonably priced, but still making a reasonable profit?

Getting the price of your new product is critical to the potential customer adoption. Like they say, you only get once chance to make a good impression and if you price your product too high you run the risk of scaring away customers, while if you price your product too low, you run the risk of leaving profits on the table.

If one industry has been hit the hardest by the advent of the internet, the retail industry has been it. The internet has enabled consumers to price compare with a click of a button and some technologies even allow consumers with smart phones to scan a bar-code of a product at one store and see what the prices are at other stores online and offline.

The law of demand states that as a price becomes lower, demand increases and vice versa. Every business owner and consumer know that lower prices mean more unit sales and price promotions via sales and coupons are an effective means for creating more short-term demand for your products.

Price wars are as common as the common cold these days. The recession has created a society of very price sensitive consumers and firms are vying for greater market share and new customer acquisition via price discounting and price promotions.

Pricing your products or services can be challenging, especially in a competitive business environment. If prices are dragging you down, maybe it's time for a quick refresher on the fundamentals of pricing.

Sometimes price adjustments make a lot of sense. But how do you know when it's time to tinker with your prices and when it's time to leave them alone?

Cost-plus is a common pricing strategy, but it might not be right for every small business. Although there are a lot of benefits to a cost-plus approach there are also some drawbacks that can't be ignored.

Competitive pricing strategies index your company's prices to the prices of your competitors. But blindly charging the same price as the competition isn't always the best option for small business owners.

Price wars are almost always a lose-lose proposition. But when survival is at stake, there are strategies small business owners can employ to make sure they are the last company standing when the smoke clears.

Pricing products is tricky, even for veteran small business owners. Maybe what you need are a few field-tested tips and suggestions to get your pricing strategy back on track.

Pricing is a difficult decision for many new businesses. Often pricing is done by copying the same format as other competitors in the same industry thus offering little differentiation between firms. Knowing how to use the law of relativity and how it drives purchasing decisions can help you and your firm use pricing strategy to successfully differentiate yourself from the competition and acquire new customers.