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Pricing strategy for small business
Work out what to charge: cost floor, market range, pricing model and tiers for a small business.
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Most small businesses underprice because they guess. Enter what you sell, what it costs you and what competitors charge, and get your break-even price, three pricing approaches side by side, a recommended price and a set of tiers - with the math shown.
Know your floor first
Your cost floor includes materials, your own time at a real hourly rate, a share of overhead and payment fees. Anything below it loses money on every sale, however busy you are. The helper works it out line by line.
Three ways to set a price
Cost-plus adds a markup to your costs. Competitor-based pegs you to the market. Value-based prices on what the result is worth to the customer. Seeing all three for your offer shows how much room you have.
Good, better, best
Offering three packages lets customers choose how much to spend, and most pick the middle. The helper designs tiers around that. To see where rivals sit, run the Competitor Analysis Generator first.
Questions
How do I price my product as a small business?
Start from your full cost per unit, look at what competitors charge, then price on the value to the customer - usually well above cost. The helper walks through all three.
How do I raise prices without losing customers?
Give notice, explain what's improved, grandfather loyal customers for a short period if you can, and keep a lower-priced option. Mention a price rise and you'll get a draft notice.
Is this financial advice?
No. It's general information to help you think through pricing. Check the numbers against your own records or with an accountant.