Home Business Tips: The Low-Down on Dropship Pricing
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Dropship pricing can’t be cut and dried because what you sell will determine the basic price. You can’t really even calculate a set figure or percentage as to what amount of profit you need to make, as your income needs and other monetary factors are not going to be the same as the next home business entrepreneur.
So, what should you factor into dropship pricing? How do you know the selling price you should ask for your products?
Setting prices is a crucial area for ecommerce just as it is for a traditional brick and mortar business. Set your prices too low and you won’t have enough of a margin for profit. Set them too high and you will probably have a hard time selling them, since unless you are selling items that are totally unique and one of a kind, you have competitors out there who will under price you.
There are a two key points that will help you determine the best dropship pricing for your items:
- Operating Expense
- Cost of Goods
To determine your overhead, or operating expense, you should sit down and make a list of all the expenses incurred in running your home business. Be sure not to leave anything out. For example, if you have an eBay store, include the monthly fee.
Once you have a full accounting of your costs for running your home dropshipping business, do the same for your personal expenses. This is especially important if your dropship business is your sole source of income.
The total of those two figures added together will be the amount of income you need each month to cover both personal and business expenses.
Next, factor in the cost of goods. This is where dealing with a wholesale product source that gives you genuine low prices becomes vitally important. If you are paying too much for the products you buy for resale, you simply will not be able to mark them up enough to make a profit.
Consumers will only pay a certain maximum price for the majority of products. If you pay too much for your products and try to jack your dropship pricing too high, you will fail.
Once you have added it all up, you can arrive at the best dropship pricing for your niche products. As long as it’s not more than the market will bear, you should do well.
Drop Ship Access has almost 2 million high quality prices available to you at genuine wholesale prices, low enough to allow your dropship pricing to provide you with plenty of profits!
If you liked this article, here is another that might interest you: Which Dropship Products Make the Most Money?