Fine monogram work
Like any other business, the pricing strategy for a home-based monogram business is a critical part of the overall marketing strategy. Pricing has the ability to attract and retain customers, or repulse or lose them. In an industry like custom monogramming, where consumers are very price conscious and profit margins can be relatively small, it becomes even more important to set the most appropriate price list for your market and your bottom line.
Instructions
1. Survey your local competitors to establish what the comparable price range is for the services you intend to offer. Be certain you log the prices of local brick and mortar businesses as well as any firms that might be doing business online; since online business can service customers in any market, don't neglect them.
2. Evaluate the most popular price points for the services you offer and see if these prices accommodate your profitability expectations. Try calculating the profit potentials of a range of prices minus the associated costs. For those prices that are on the high end, define what services or added value the entities offer to justify the price. For prices that are low, find out what services customers are willing to sacrifice to save the cost difference.
3. Set your pricing strategy. Once you have a clear understanding of the various pricing levels (price points) and the corresponding quality and service levels, you will need to decide if you will maintain a premium (high), competitive (mid-range) or low-cost leader (best service for the lowest price) pricing strategy. Each of these basic strategies balances a volume of sales against the average profit margin per sale. For example, low-cost leader strategies seek huge volume by reducing margins to the minimum, while premium pricing sacrifices volume to achieve high margins on every sale.
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