Test How to price your products?

QUESTION 1: WHAT IS THE IMPLICATION OF MARKET RESEARCH FOR PRICING OUR SERVICES?

It is impossible nowadays to establish an adequate price for both your business and the customer without knowing what the demand is in the local, national or world market
If we are going to start a business and we do not see its previous performance in the market then we are making a big mistake
In order to price our services and products, it is necessary to study the market of offers and demands in a general sense, and then to enter into specifics
We can start with questions such as how much does our service cost in the labor market and why?

It is clear that when we look at the market we always stop at businesses similar to ours, as they are our main reference and even more so if they have experience and clientele
Once our market niche has been defined, it is important to identify the competition
Here we can get a closer reference to establish standard prices with the competition
When we analyze the competition and their offer we look at what are their strengths and weaknesses, what can we take advantage of their weaknesses to offer a different proposal

As a necessary aspect for a price estimate for our product or service, we look into the cost of production by our company
The cost of production defines about sixty percent of the price we want to establish, since this is where we calculate the resources used, time invested and quality
The price is not a value that we take only as a reference from other businesses, but rather, the greatest guarantee of what the price could be comes from the cost of production
Another necessary aspect to consider for our price after the cost of production is the value

For our business to be sustainable, it must not only report the cost of production but also generate profits
To establish a price for our service we take into account the cost of production plus a percentage mark-up as profit
This percentage of profit would be the return on the time invested and the value to the customer
Based on this, it is necessary to take into account the client for whom our service is intended, and this would determine a price differentiated according to levels of complexity

For a business coach to offer his service, he sets rates for start-up entrepreneurs, students, companies in formation or high start-up companies
The price is also measured by the type of counseling, whether it is individual or group coaching, online or face-to-face

As you know, pricing your service is not easy, but you also have to take into account how much is the client willing to pay for our service?
Knowing the economic scope of our potential customers can help us to position our service around their demand
Demand for our type of business plays an important role in our pricing
Sometimes it is not important how many customers we can have

In some cases, it is better to have regular and systematic clients, offering a moderate price, than to offer our services with high prices and sporadic or casual clients
As we are focusing the price of our service on demand it is also advisable to offer trial sections where the client can see the value of the service and the benefit of its results