Pricing Our Items | Ramblings of an e-trader

Friday, 27 June 2008

Pricing Our Items

I was discussing with a friend on how well a certain item could sell and he told me that it depends how much I would be selling my item. Well, of course, pricing of an item would be important. However, I need to know the cost price and then only add a certain percentage on top of that as miscellaneous cost and then only profit.

I have heard that there are retailers, those who have shops and depend on walk in customers, who would mark up their prices anywhere from 300 - 500%. That is a amazing profit margin, if the item could sell. And yes, they do sell like hot cakes, because customers do not know, some do not care, that the retailers have already marked up 300 - 500% on top of cost price, as long as they can get hold of the items that they want!

As for those of us in the web business, profit margin need to be as high as 300%, most of us do not even make 100% profit, since our layout cost is low.


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