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Home Based Businesses: Pricing Your Product or Service

Jun 11, 2008
You should be testing your competition to determine your prices. Where the competition failed to measure up to your expectations, you can design your business to shine. You may find that they're very good. In that case, you may have to specialize with your product or service.

Think about the last time you made a major purchase. The price tag was important, but that wasn't all you considered. If it was, you wouldn't have had to spend three hours making your decision. You'd have just asked for the cheapest one right off the bat with your easy ways to make money from home.

Pricing won't be the only thing that separates you from your competition either, but there's no doubt it's important. Most consumers today are price conscious. Your price for your goods or services must be realistic; you have to be able to make a profit from what you sell. And the public must understand your easy ways to make money from home and your pricing policy.

If you charge lower prices than the competition - something that home-based businesses can often afford to do because of lower overhead - you don't want to come off as offering inferior goods or services. The public can become suspicious and worry that it's not getting quality merchandise. You may even have to explain why you charge lower prices. For example, if you can buy more economically than your competitor, tell the public that you pass the savings on to them.

If you charge higher prices, make sure the public understands what additional benefit it's getting. Many people are willing to pay higher prices for something if there is added value. This might include personal service, a longer warranty, or a money-back guarantee.

The best way to formulate your business concept is to put it in writing. This means writing a business plan.

A lot of folks start a home-based business as a casual sideline. This is a mistake. If you fail to take the business seriously, others may not take you seriously. Writing a business plan shows serious intent. There are several important reasons to write a business plan for your easy ways to make money from home.

First you should organize your ideas on paper. You may think you have things straight, but until you put them in writing you can't be sure. For example, you may have thought about how you'll sell your services, but maybe you haven't thought through how much money you'll need to meet your advertising budget. To complete your report, you may even have to do additional research on your idea.

Learn the strengths and weaknesses of your business concept. As you develop your plan, you'll find what aspects of your concept are real winners. You'll also learn where your idea just doesn't hold water. In the plan you'll be addressing all aspects of business operations like personnel, marketing and finance. By writing the plan, you'll find out what areas you need to learn more about. For example, when you put everything in writing you may discover that you just can't do it all yourself.
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