By market price we mean what the price the customer is willing to pay for the product or service you are offering. This includes the quality, frequency, packaging and presentation, after-sales service, financial deals etc. You have to decide this and endeavour to attain the highest price the market can bear.
If the price that you can get for your product service isn’t high enough to give a profitable return on your investment you need to rethink your business.
The only way to ascertain the price is to carefully study your customers, their needs and their priorities and decide how these affect the requirement for your product or service.
Once the price has been ascertained you must gear your advertising and selling methods around this ‘image’. In other words you must sell goods or provide services which people feel meet their needs in a cost effective and pleasing manner.
Although you may have the right price don’t forget people buy from people they like and to meet a need they perceive.
Questions to ask yourself:
- When selling direct to the public will your products or services enhance their wealth and self image, health, their pleasure etc.
- When selling through intermediaries. Will your products or services fit in with their existing ranges? Will you help with providing merchandising and advertising as part of the deal? If required will you provide installation and after- sales service as part of the deal? Are your trading terms acceptable?
- If selling to industrial, commercial or public bodies. Who will make the buying decision? What will be the appeal to those actually buying the goods? What will make them appeal to the purchasing manager, when you finally get to him?
- What are you competitors charging? How do your products and services compare price for price when you take in the overall package.
As you can see there are many areas to consider and something that should be thought out carefully before any investment is made.
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