Marketing is a field in its self! To us tech types it usually seems practical to price our products so that we are fairly compensated for our efforts. That sometimes works but is rarely the best metod for pricing. The resources you put into your project are sunk costs. They are not relevant to future decisions. A more appropriate pricing strategy is to try to estimate how many of your product at what price will be best for you. At some point, the market is satisfied and no further product can be sold at any price. If you price too high, you will not sell many units. If you price too low the market will be satisfied before you get your share of the compensation. Also, it is just a matter of time before someone else is able to produce the product more efficiently than you. Your time on top is limited. Good luck! ----- Original Message ----- From: "Jinx" To: Sent: Monday, April 14, 2003 11:06 PM Subject: [PIC]: Product pricing > Now, this may seem like a silly question with an obvious answer, > and a fortunate position to be in, but it's left me very undecided > > I'm trying to put a price on a product that's ready for small-medium > manufacture. It's based around a fairly simple F628 program that > took around 20 (productive) hours to write and about NZ$47 worth > of components. Hand assembly takes 4-5 hours > > The opposition product, which does exactly the same job, costs > NZ$1350. I've never physically examined this product to copy it, I > was told what it does and just did it my way, actually improving it. > Apparently the opposition product does sell quite well, and as far > as I know, my version is the only other competitor > > Spread over a first run of 12 units, even charging $100/hr for s/w > and $30/hr for assembly, this comes to about NZ$334/unit, which > is over $1000/unit less than the other product > > There's very little in the way of further costs - no packaging, no > distribution, no advertising > > My feeling, because I'm a nice guy, is that NZ$334 is a fair price, > and in future it would be even fairer because I've recouped the > s/w development cost. Yet I can't help also feeling that $1000 is > a big gap between me and the opposition and I should be trying > to narrow that down by several hundred dollars > > Does anyone have advice ? Normally I don't have this problem > because the differential is nowhere near as great > > -- > http://www.piclist.com#nomail Going offline? Don't AutoReply us! > email listserv@mitvma.mit.edu with SET PICList DIGEST in the body > -- http://www.piclist.com#nomail Going offline? Don't AutoReply us! email listserv@mitvma.mit.edu with SET PICList DIGEST in the body