Too High? or Too Low? How Should You Price Your Products?

This comment caught my attention today:

When I was younger, this was how I thought too. You see, most consumers tend to base their perception of the actual cost only on the material cost.

I’m sure you’ve heard this before – A pair of Nike shoes cost only $20 to manufacture. But is this really the case?

What about all the time, energy, and money spent on marketing, research, and design? What about all endless attempts of trying and failing, try and failing, that finally culminated in a product that’s good enough to be introduced into the market? How are we even going to put a price on all the early years, where thousands, or even millions, of dollars, were being invested, without even knowing if the venture would really turn out well?

Why I find this topic particularly important is not because I want to criticize anybody but I hope to encourage you to see past the things that most people would see.

If there’s a rule that says that we can only sell our products at a markup of, let’s say 50%, then the stuff that will be available will only be functional at best, but uninspiring. Our budget and needs will be satisfied, but not our dreams.

Perhaps you’re thinking about starting a business or perhaps you’re thinking about how you should price your products and you’re worried if you’ll be pricing them either too high or too low.

Of course, you need to at least have some basic understanding and knowledge of pricing strategies but ultimately, let the price come from your heart because when the things you do and the decisions you make come from your heart, your customers will feel it, and if your customers can feel it, they will appreciate it (and hopefully, buy it).

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