The price of your product is almost always a driver of purchasing behavior. Price your product too low and you may cut into your profit margins or send a message that your product’s quality is lacking. Price it too high, however, and you lose potential customers and purchases. That is why determining your product’s perfect price point is so critical.
One of the starting points to determine your product’s price point is to conduct market research. After the market research, you must set a market price. When setting these prices, consider your profit margin, which is typically 30% or above. Retailers may want a profit margin of more than 50%, so keep the retail price in mind as you calculate it. You may want to provide a “suggested retail price” to help ensure that retailers price your item competitively — though you cannot control the final price that retailers set. For more information about the factors to consider when pricing your product, check out the accompanying resource.