How do you set your price

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Information about How do you set your price
Business & Mgmt

Published on March 12, 2014

Author: FrancesKazan



Managers know what you are charging and make sure your customers know what they are paying for

How do you set your Price?

Setting prices for your goods and services seems to be a stumper for many businesses especially the micro-preneurs

Too high and items sit forever Too low and you cut your own profit margin.

• It’d be wonderful to have a secret formula that magically produced a good sales price for you.

• While a such a secret formula doesn’t exist — here is a story of price setting that makes you laugh but also makes a very important point ….

Hotel Bill -Take a minute to read this and laugh…… • An older lady decided to give herself a big treat for her 70th birthday by staying overnight in a really nice hotel. When she checked out the next morning, the desk clerk handed her a bill for $250.00. She demanded to know why the charge was so high. "I agree it's a nice hotel, but the rooms aren't worth $250.00 for just an overnight stay! I didn't even have breakfast."

The clerk told her that $250.00 is the 'standard rate', and breakfast had been included had she wanted it. She insisted on speaking to the Manager. The Manager appeared and, forewarned by the desk clerk, announced: "This hotel has an Olympic-sized pool and a huge conference centre which are available for use." "But I didn't use them," she said. ''Well, they are here, and you could have," explained the Manager.

He went on to explain that she could also have seen one of the in-hotel shows for which they were so famous. "We have the best entertainers from the world over performing here," the Manager said. "But I didn't go to any of those shows," she said. "Well, we have them, and you could have," the Manager replied.

No matter what amenity the Manager mentioned, she replied, "But I didn't use it!" and the Manager countered with his standard response

After several minutes discussion, and with the Manager still unmoved, she decided to pay, wrote a check and gave it to him. The Manager was surprised when he looked at the check. "But madam, this check is for $50.00." "That's correct I charged you $200.00 for sleeping with me," she replied. "But I didn't!" exclaimed the very surprised Manager. "Well, too bad, I was here, and you could have."

• There are so many lessons to learn from this story ….. • Which one sticks out for you?

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