Finding the Right Price for Your Retail Products

by Ronald L. Bond
MSNBC.MSN.com

You often see or hear retailers' advertisements that promise you "quality merchandise at a fair price." Well, just what is a "fair price?" As you enter the retailing arena, you will soon learn that there really is no universally accepted definition. Most of the time the answer is "It depends. . ." It depends on how much you paid for the merchandise, who you bought it from, what your competitors are charging, your overhead expenses, your sales volume, and a hundred other variables.

How you establish prices for your merchandise will be one of the most important decisions you will make, since it directly affects that all-important variable, profit. You must strike a delicate balance, setting a price that is high enough to allow you to achievea reasonable profit margin and yet low enough to keep your merchandise affordable and competitive.

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