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The price of your product

How do I set the price of my product? It's a problem I've encountered and many people have questioned me about it..

This topic is deep in my book The Magic of Businesses That Don't Go BankruptThere are several elements that must be taken into account in order to answer this question. Now we will see 4 that I think are worth paying attention to.

  1. CURRENT Market.
  2. Competence.
  3. Replacement cost.
  4. Worth.

Current Market

The cost of a product is strongly influenced by the current situation of the market.In the case of perishable products, when there is a shortage of avocados in the country, for example, their value will increase. Otherwise, during months of high production, their value will decrease.

When there is an excess of a product, the current market situation is analyzed, which will determine the value at this point.

Competition and replacement

Competition determines the price range in which your product will be placed according to its individual characteristics compared to other similar products. A product of equal quality and benefits will give you a range of +2% and -2%, a larger range will make selling more difficult.

Replacing a product also generates a cost and a value for the customer, the frequency of change and the ease with which they can find your product to replace it also plays an important factor, if your product is difficult to replace for different reasons, production is limited, reduced points of sale etc, are factors that give exclusivity and luxury, generating greater value to the consumer

Perceived value

Finally the value, as I mentioned above, Consumer value is the benefit perceived by the consumer when purchasing or using your product or service. When a customer feels that they have received a fair benefit for the price they have paid, then they are a satisfied customer. A consumer who feels he is getting more than he paid for is a returning customer, recommends and becomes a sales agent for your product, but we can go into more detail about this later.

I invite you to leave a comment if you want to learn more about this topic and I would like to know what you think about it.