| In our scramble to find a way to offer the | | | | you sell more than 3 boxes a year, I'll EAT |
| lowest prices on the Internet, we often | | | | some.Unique is Rain Barrels made in Maine. |
| overlook the basic steps that we should be | | | | It's Exotic Cheeses imported from Italy. Silk |
| taking BEFORE we even offer a product for | | | | Parisian Lingerie. Things you don't see every |
| sale.We also overlook something even more | | | | day, but would be proud to give as a |
| important: you don't HAVE to have the lowest | | | | gift.Then there's "common". Everybody and |
| price in order to make great sales. Following | | | | their grandmothers are selling Alabaster |
| are some things I do before and after | | | | Figurines on the Internet. Do they sell? |
| determining my bottom line. I sell by having | | | | Sure, in a limited fashion. Do you want to |
| products drop-shipped for my sites, which | | | | sell them? Not if you want to make any real |
| works VERY well, but these steps should be | | | | money.In my experience, unique products, like |
| covered no matter your distribution | | | | Rain Barrels and Parisian Lingerie, DO sell. |
| method.Should you be selling this item | | | | So do Coleman Sleeping Bags, and Conair Hair |
| now?Snowboards don't sell well in the | | | | Dryers. BRAND NAMES sell. Look at your |
| summertime. You may have a hard time moving a | | | | potential product, and ask yourself honestly |
| pair of roller blades in January. Don't waste | | | | if YOU would buy it on the 'Net.Set your |
| your time and your site space marketing | | | | priceTake the five lowest prices you |
| products out of season. Ask your supplier for | | | | collected on a product in your list that has |
| a little historical information regarding the | | | | survived the above. Calculate your estimated |
| best time to sell their products. Believe me, | | | | cost, then subtract that from the lowest |
| to everything, there IS a season. They have | | | | price. If you don't see at LEAST 15% profit, |
| the figures. If they don't want to share this | | | | don't bother.If you do, there are a couple of |
| info with you, find another supplier.Identify | | | | ways to proceed. You can undercut the lowest |
| your costsProfit isn't just the difference | | | | price in your "venue" by a bit, and hope to |
| between wholesale and retail. You have other | | | | "kick off" the product and get yourself |
| costs to consider. Think about every penny | | | | noticed. Chances are, though, that the |
| you spend in order to get that product to the | | | | following week you'll find that someone has |
| customer's door, and plan accordingly. For | | | | undercut YOUR price by just a bit. That |
| example, your merchant account probably costs | | | | becomes a losing game.I generally set up a |
| you about 2.2% plus 30 cents per transaction. | | | | couple of "loss leaders". These are desirable |
| On an item you'll sell for $20, that's 74 | | | | items (in my general product line) that I |
| cents. Don't forget that calculation when | | | | sell dirt cheap just to bring in customers. |
| pricing the item. Are you warehousing the | | | | Then I price the rest of my products at the |
| item? How much is that space costing you per | | | | second or third lowest price in my venue. The |
| item per month? Did you spend money stocking | | | | customers come in for the loss leaders, and |
| up on shipping materials? How much per unit? | | | | then I can market everything else to them via |
| What about advertising? Monthly hosting | | | | email. I spend a lot of time making my site |
| costs? You may need to project some estimated | | | | look better and easier to navigate, and pay a |
| sales in order to arrive at some of these | | | | great deal of attention to my customers.That |
| figures.This may seem very complicated, but | | | | makes me more reputable in the eyes of the |
| it's really not. Just take the figures one at | | | | customer. You'll find that people don't mind |
| a time, and you'll arrive at a wholesale cost | | | | paying just a little more if they feel |
| plus an amount that, when added together, | | | | comfortable in your store. They don't like to |
| becomes your initial ESTIMATE of "cost of | | | | worry that they're buying from a "hack" who |
| goods sold". Identifying all your costs is | | | | may not deliver. Nothing says "hack" like a |
| critical if you want to price your products | | | | cluttered, confusing storefront.Follow |
| properly.Check out the competitionSearch on | | | | upAfter you've sold an item for a month or |
| the item you plan to sell. Check out the | | | | two, revise that "cost of goods sold". |
| competitors' prices. But DON'T get caught up | | | | Measuring past performance is just as |
| trying to beat the wrong competitor. You need | | | | important as setting the correct price to |
| to stay within your "venue".My stores are | | | | begin with. If sales drop, recheck your |
| built in Yahoo Shopping ( 90% of my traffic | | | | competition. If that's not it, drop the |
| comes from there. When I seek out my | | | | product, or shelve it until the "season" |
| competitors, I look for other businesses like | | | | comes back around. Don't get sentimental |
| mine ONLY in Yahoo Shopping. Then I | | | | about your products, and NEVER just let your |
| compare.If I'm thinking about selling a | | | | store sit there in limbo once it starts to |
| product, and I get 1,500 hits in 400 stores | | | | make money. This is a dynamic business; stay |
| on that item in Yahoo Shopping, forget it. If | | | | on top of it!A last word (or three)Retail |
| I get a hundred hits in 20 to 40 stores, I'll | | | | pricing on the Internet is so fraught with |
| look into it further.So check out the | | | | permutations that it would be impossible to |
| competition, narrow down your product list, | | | | cover everything here, even if I KNEW |
| make a note of the five lowest prices you | | | | everything. The steps above are just the |
| find, and then ask yourself another | | | | basics of a process that works for me. |
| question:Is anybody going to buy this | | | | Hopefully something here will strike a chord |
| thing?This doesn't have much to do with | | | | and work for you as well. Patience and |
| pricing, but it should be said.When | | | | persistence are the keys to a successful |
| considering products, there's unique, and | | | | Internet business, so hang in there, and |
| then there's too unique. Yak Cheese may sound | | | | don't quit the day job for at least a couple |
| like something that nobody else has for sale | | | | of weeks. ;o)I hope this helps in your future |
| on the 'Net. There's a reason for that. If | | | | marketing decisions. |