How should the product pricing of the independent foreign trade station be determined?Product price pricing formula skills

Most of the people who are just starting an independent websiteE-commerceSellers all have pricing issues.

Other sellers are said to be 3x, 5x, or even 10x the cost.

No matter how much, this is the routine of other sellers and is not suitable for new sellers.

In order for independent sellers to be profitable and able to place orders for product pricing, they need to comprehensively consider many aspects, of which the pricing principle is the basis of everything.

How should the product pricing of the independent foreign trade station be determined?

First of all, aside from the uniqueness of independent websites, starting from the most basic pricing principles, the seller's product pricing should be: the sum of all costs incurred in bringing the product to the market + the seller's expected profit.

This is the simplest and most commonly used pricing logic for product pricing.For example, to calculate the price of a short sleeve, the cost of a short sleeve includes:

• Raw material (procurement) cost: $5.
• Labor cost: $25.
• Shipping: $5.
• Marketing and administrative costs: $10.
• Based on a cost of $45, plus 35% of the price as profit.

Foreign trade independent station product price pricing formula skills

The pricing formula is:Cost ($45) x Profit Markup ($1.35) = Price ($60.75)

• If a seller wants to sell this short sleeve on an independent website, the cost will involve many aspects.
• In addition to basic product procurement costs and labor costs,Web PromotionAdvertising costs, logistics costs for fixed marketing costs, store plug-ins, website rentals, website platform commissions, payment platform rates, etc., all need to be included in the cost.
• The cost calculation part is easy to understand and easy to calculate, but the profit markup rate is not easy to grasp.
• The profit markup of some products is several times the cost, while some products can only increase by 20%-40%.

How to calculate the profit markup ratio?

From the principle of the formula: profit markup = (product price - product cost) / product price.

For example, if a product with a total cost of $15 is sold for $37.50, the profit plus is 60% and the profit is $22.50.

 Profit margins don't apply to all products, though.

If the profit margins are the same, the higher-priced product is more profitable, and the lower-priced product is less profitable.

The above are the product pricing principles of independent websites, and I hope to be helpful to all independent website sellers.