Getting your pricing right in business can be tricky, and it’s all too easy to get it wrong. More often than not, business owners under price and leave money on the table. This is because business owners typically worry more about prices than the customer does. The customer is normally more concerned about other factors like reliability, honesty, getting the job done right first time, punctuality, speed of service or response, and willingness to put things right if they go wrong.
How do you set your prices? Here are a few of the common methods:
Cost plus: There are many variations here, but basically you work out your annual overheads and add the required net profit to calculate the necessary turnover, having adjusted for any mark-up on purchases, and materials or parts.
Read more about pricing here.
