Business owners are wondering how to properly mark up the product or service they sell. When determining the price, it is necessary to make it such that the demand of buyers does not fall, and the profit is greater.
Instructions
Step 1
Estimate the size of your costs, which do not go directly to the production or purchase of goods. Include in this amount expenses for rent, wages, minimum advertising and other mandatory payments that will not depend on the size of the sale.
Step 2
Knowing the amount of costs per unit of production and changing the amount of the margin, you can calculate how much of the product you need to sell in order to recoup the fixed costs. You also need to consider your capabilities. When making calculations, think about whether you can sell such a quantity of goods at one price or another.
Step 3
Remember that there are different markups for different groups of products. A high-quality, rare, rarely bought product is rated higher. The mark-up on basic necessities, food, consumer goods is much lower.
Step 4
Be sure to consider the cost of competing services. You can make the markup slightly lower if you want to increase your sales. If you are not chasing millions, you only need a constant income with a small workload, then prices can be raised a little.
Step 5
If you are planning to provide your regular customers and large customers with discounts, bonuses and gifts, then it is advisable to include these costs in your margin.
Step 6
If you are a payer of taxes that depend on the turnover of products (simplified taxation system), then you can protect yourself from losses by adding this percentage to the amount of the margin.
