How you price your retail products directly affects your company’s sales and bottom line. Pricing your products too high may result into losing out on potential sales. But low prices can cut into your profits and cause people to view your products as low quality. Finding that middle balance is the key to successful product pricing.
One of the most effective retail pricing strategies for your Indian business is to take a look at your competition. Once you see what other companies charge for similar products, you can make a more informed decision.
After you’ve discovered a general price point, you can decide whether 1) you prefer to reach a broader market by offering lower prices or 2) give your products a sense of prestige by attaching higher prices to them. Of course, you can also match your competitor’s prices. But going lower or higher helps you to stand out from the crowd.
It’s always a good idea to consider the demand for your product as you select a pricing structure. For example, if you have a niche product that’s only available through your company, you can probably charge higher price. If similar versions of your product are readily available, you may need to rely on lower pricing to gain a competitive edge.
If you’re still struggling to price your products appropriately, you may want to 1) hold a focus group and/or 2) reach out to customers to fill out surveys. That way, you can get a feel for how the market may react before you actually make any changes. You may also need to consider any changes in tax categories caused by the Goods and Services Tax (GST). Remember, it’s easier to start high and then lower your prices than to start low and raise them. Pay attention to your sales and customer reactions, and then make changes accordingly as you go.