Finding the optimum prices for your products is not a straight-forward and easy process for most of the time as you need to have a really good mechanism that takes into calculation your costs, your target profit margin, the competition, demand in the market etc.
No entanto, as evaluating all these factors at the same time is a bit challenging, there are some different strategies for pricing like cost-based pricing, premium pricing, penetration pricing or such other strategies. This post will be about cost-based pricing and how to apply it with Prisync‘s Dynamic Pricing Module.
Cost-based pricing is simply adding a certain percentage or amount of markup to your products’ internal costs to find your prices. This is the simplest methods among different pricing strategies to find which level a product should be priced at. See the example below.
Product Cost: $160
Profit Margin Goal: 25%
Sales Price: 160 + (160*25/100) = $200
Então, $200 is our minimum sales price that satisfies our target profit margin. Besides this, you can also take into the calculation of your competitors’ prices in the market to see if this is really the best price that you can have. Por exemplo, if your cheapest competitor sells this product at $239, I think you shouldn’t wait at $200 as you have an opportunity to increase your prices until $238 by still staying the cheapest and having more profit. Let me explain, how to apply these strategies thanks to our Dynamic Pricing Module.
Dynamic Pricing Module
With this module, you’re also able to add your product costs to your products that you track in your Prisync conta. See it how a product cost looks like in your dashboard.
To see how to add your cost to your products, please watch this quick video:
After adding your costs to your products, it’s time to find your SmartPrices based on your costs, seus concorrentes’ prices and your target profit margins. You can easily set the pricing rules in Dynamic Pricing page. In this page, you can firstly pick up the product range that you want to apply your pricing rule and then create your rule.
The rule can be based on just your competitors’ prices or both your costs and your competitors’ preços. Let’s get started with the first one which is simpler. Então, to set up a rule based on just your competitors’ preços, you have three options like;
-my price should be equal to the cheapest, média ou the highest price in the market.
Por exemplo, if you have a price-match promise to your customers and want to keep them happy, Você pode configurar uma regra como my price should be equal to the cheapest. (Ver abaixo)
Apart from this, you can also include your costs and your target profit margins to the rules to find smarter prices for your products. Para isso, you can pick up the first option and create your rule. Por exemplo, you can define a rule like;
My price should be lower 2% than cheapest of my competitors but it shouldn’t be lower than my cost + 20% margem de lucro. (Ver abaixo)
After setting up your rules, you can immediately see the effects of these rules under SmartPrice Live View Section and if the SmartPrices that the system suggests make sense for you, you can save the rule and start seeing the SmartPrices in the products page, in your excel reports and also in your API.
We have also a quick video which covers our Dynamic Pricing Module:
Para resumir, with our Dynamic Pricing Module, you can apply a cost-based pricing strategy and find the SmartPrices for your products. You can also connect these outputs into your internal systems via our API and even have a fully automated re-pricing system! If you’re interested in building such mechanism, you can try for free all these features for 14 days from here!