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How much should you pay for an item – any item?  If you asked the majority of consumers they would say that a fair price would cover the cost of manufacture plus a little extra for profit. 

The following is a transcript from a Professional Pricing Society Podcast, recorded on Thursday 5^th January 2017.

To be a successful Ecommerce retailer you need to pay close attention to your pricing strategy/pricing strategies. 

None of us are perfect and we all make mistakes - come on, even you!!  Well, some mistakes can be quickly mended but other mistakes cost us money and when it's your livelihood that's a very serious matter.

1. How do you know if your pricing strategy is working? 
2. How do you know if the prices you have set are the best prices for your goods or services? 
3. When was the last time you made iterative changes to your pricing strategy to test if that made a difference to your overall profitability or revenues?
4. Are you reliant on traditional pricing strategies such as cost-plus pricing?

Manufacturers face their own unique pricing challenges with ever-changing products and demand.

It's a real conundrum to accurately estimate a fair market value for manufactured products whilst at the same time managing to keep a close eye on the bottom-line. Just keeping the whole process ticking over can be an achievement in itself ; looking forward to a healthy profit at the end of a revised pricing process should provide momentum and be an added bonus in these difficult times.

This post was sparked off the back of a tweet I was shown by my good friend Doug Ayling, when we were debating, over a pint of course, why some software companies don’t show their pricing.

Competitive-based pricing is used by many businesses in order to keep prices low while still making money. It's also known as "price leadership."

Why You Need to Understand Competitor Pricing

Competitive-based pricing, or market-oriented pricing, involves setting a price based upon an analysis of what the competition is up to pricing-wise. You can choose to price-match - or price your goods higher or lower, dependent on what your overall business goals are and how you wish your product to be perceived.

Pricing has moved with the times. Pricing professionals now have to dig deeper into buyers' thought processes to understand what will persuade them to make a purchase.

We all continue to enjoy acquiring new stuff but we've become much more canny about when and where we spend our hard-earned cash. Your potential customers now need to believe they're getting a good deal by buying your product.

Pricing strategy can be challenging, complex - and offers no shortcuts. Unfortunately there is no magic wand to wave nor just one pricing strategy that will produce the greatest profits under ALL conditions.