When Is The Price Right?

Effective pricing is crucial to remain competitive and move product

AND DON’Ts

  • Do know your costs (including overhead) and properly account for both direct and indirect costs.
  • Do enlist “price trackers” in your company to track competitors’ pricing strategies. Gather updated price information for each competitor.
  • Do understand the position that you want your pricing to communicate and stick with that vision.
  • Do base your pricing on value. This can be challenging to determine and takes more work, but it will pay off in the long run.
  • Don’t let your competitors be the end-all determiners of your pricing strategies.
  • Don’t rely solely on your costs of delivering a product or service to come up with your rates. This could result in under or overpricing.
  • Don’t use the “out-of-the-air” or “gut feeling” approaches to pricing. Neither are good long-term business processes.
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