How much are you worth? Every entrepreneur or professional should know how to answer this question, but it is especially important for those involved in B2B ecommerce. Competition is at its highest over the Internet, making it essential that you know what your work and wares are worth. Charge too much and no client will buy from you; ask for too little and you miss out on resources you could be using to expand your company. You thus much come up with a pricing strategy that reflects the true value of your goods, which may involve:
The simplest way to price your items for ecommerce sales is to give them the same price tags as they would have in a traditional retail store. If you have your own store, you can duplicate those prices online; if not, just go to a competitor’s store and use their prices. The benefit of this method is that it gives customers the same price no matter where they shop, so they never feel like you’re charging them too much. However, the marginal cost of an online sale may be different than that of a traditional retail one, making this method potentially inaccurate.
Besides looking at how much your items cost in physical stores, you can look at what your competitors are charging on their websites. This is the most direct way to match your competitors and ensure that they are not undercutting you. In using this method, make sure to consider how your products and customer service differ from that of your competitors. If you offer more value with each product, you can and should charge more; if you offer less, you’ll need lower prices to stay competitive.
Marginal Cost Methods
One common pricing method is to estimate the marginal cost of selling each item online. To figure this out, add up everything you pay to get your hands on the item, as well as the cost of your website and the value of the time you spend selling. By taking every cost into account, you can determine the fairest possible price for each item. You should then charge exactly that much.
In these or any other B2B pricing strategies, it’s important to consider what type of value you’re giving customers and how that might affect your prices. If your company is focused on selling to businesses in large quantities, without much focus on the specific features of each product, you should try to keep your prices as low as possible. But if you instead focus on selling products of exceptional quality and durability, or on offering the best customer service on the market, it makes sense to charge more so you can sustain these benefits. Your goal should be to ensure that customers are never getting more or less than what they pay for.
To learn more about pricing and other keys to ecommerce success, contact SellersCommerce today.