How do you set your ecommerce prices?
It’s one of the trickiest dilemmas that any online seller will have to face. How do you set the price of the goods your selling online for buyers?
You’ll have lots of things to consider. How much you paid for the stock and the overheads that you face as you run your business will be at the front of your mind. But what about the flux of prices on the marketplaces and on your site with regard to retail in general?
There are stacks of tools available that will help you mine data: Terapeak being one of the most obvious. Repricers also offer amazing utility when it comes to staying on top of your competitors.
But to a great extent the decisions should be sober and calculated when it comes to pricing and your decisions as scientific as possible.
If this is a topic you want to think more about, this white paper from rjmetrics will give you food for thought. It’s a free download packed full of interesting ideas about the pricing your ecommerce sales.
I would actually like to read this white paper, but in addition to providing your email (understandable), you MUST include your telephone number.
This just tells me that this company isn’t confident in its own white paper. If interested I will follow it up and contact them.
The only reason they need my telephone number is to pester me with a chase up call.
If you have confidence in your white paper, remove the compulsory telephone field and lets sellers decide for themselves.
I use a spreadsheet for calculating the various costs, fees, and margins and would have been very interested in the white paper, but I will Not contact companies that operate this way.
Its very simple:
1) Go on Google and type “buy” followed by make and model.
2) Check prices on eBay and Amazon
3) Go 5 pence below the lowest of the above after shipping is included, and then factor in your costs including purchase cost, selling fees, overheads, packing/handling, etc, as that will be your profit
4) For each item in inventory do all the above regularly. Especially if its something that is “mass-market” and has many other sellers with same.
General rule of thumb: Cheapest sells!!
If you can’t beat Google, eBay and Amazon then you may have a problem selling your stock so it may be better to stock something else.
All the above takes about 2 minutes and tells you if you have a product that will easily sell. You don’t need any subscription service or other help to do the above.
I never wanted to be the cheapest – especially selling used printers the quality varies enormously. Often I’d be towards the top end of the price range on eBay but I still sold plenty due to reputation and the simple fact that the printers I sold worked and worked well!
Far too many cheap ones on eBay with various faults or that didn’t disclose the page count or didn’t list extras such as network cards or duplex units built in and buyers were always more than happy to pay for certainty over the unknown.
There are always exceptions and thats why I used the term “General rule of thumb”.
Professional second hand sellers are a minority. Most sellers are businesses selling new product, or are private sellers clearing clutter. I take your point about reputation, after sales, etc… and this is why I do well on eBay.
The fact remains that for most sellers selling brand new “mass market” items they need to have the cheapest price to clear stock.
But I expect you already know all this.
You don’t have to be cheapest. You just have to be top of eBay’s Best Match or win the Amazon Buy Box.
There are lots of ways to win and being cheapest is simply the laziest and the most expensive. Anyone who’s any good at selling will know that always being the cheapest is the quickest way to go bust!
For instance on Amazon the Buy Box takes into account your depth of inventory – you can be cheapest with only stock of 10 and someone more expensive but with 100 units in stock will get the Buy Box and the majority of sales.
Same on eBay – he who has the most recent sales will easily trump someone with little stock and a lower price if they know what they’re doing.
Actually not correct but I certainly won’t disclose any more of my model that I already have. What I said works and after 5 years i’m still trading and many of my professional competitors have fallen.
Frankly Chris I think you like to argue and it makes annoying reading. But I expect most regular contributers to this Forum already know that. Maybe you should take a Chill Pill?
As one of the editors of Tamebay I can easily arrange to block your IP address and free you from all the “annoying reading” if you so wish? After 5653 posts and I hate to think how many thousands of comments I’m surprised you still read if you have such a low opinion of what I write.
Long time since someone told me to take a chill pill on my own blog ha ha
must be National Chris Bashing day, i’m waiting….
Me next Chris…..
My complaint is………………., erm….erm….erm, wait a moment thinking…..erm, erm. oh yes, no wait that’s for ebay….erm…erm…Mind’s completely blank, Ha, ha, ha…
Stand up for yourself mate…!!
I found the last chill pill…. It was Jade, six years ago at 1:07 pm on the 15th April 2008, although he was somewhat more polite and it wasn’t directed at me personally :-)
Actually, I’m with Chris completely. You definitely don’t have to be cheapest, that’s always been our philosophy and it works. We’ve been selling online for over 10 years.
if we needed to read this white paper at all we would not be running a business
I am lucky. I sell New Books(OK to keep Cambridge_Blue happy some of them are remainders but a remainder is only a Brand New Book being sold cheap to clear space in the Warehouse) and most come with a Price printed on them. But I too go through a procedure very similar to the above to work out the price I will actually quote in my listing.
However as I took advantage of the Free Listing Weekend every item there was an ebay flashing note advising me to start the listing at 99p as I would get many more buyers. Obviously I took no notice at all of this insanity. After all some of the Books that I was Listing were £20 or more in price. Listing them at 99p might find a customer or two but that is about all.
But I doubt if I was the only ebay seller who had this flashing ‘advice’. I wonder if anybody took any notice at all of it???
Ohhh god, another so called “promotion”? But is it?
More cheapscates living in hope and cluttering up the site with all the crap from the under the stairs and their unsold leftovers from the car boot sale in the hope that something will sell but saving on listing fees cos they know it probably won’t sell.
As I said before, if you think your item has value you would not hesitate to pay a listing fee.
Only cheapscates selling rubbish “wait” for free listings.
Free listing promos should be stopped. They clutter the site and damage eBay’s brand.
I hope your comments were not aimed at me. Rubbish you said I said I sell NEW Books. The only people who would equate NEW Books with Rubbish would be those who do not read Books. They are usually the poorly Educated who cannot Read and those who perhaps have no interest in Books printed on paper(I do not sell electronic books).
My stock is not under the stairs nor has it ever been to a Car Boot Sale. Years ago I used to take a Book Stall to Specialist Events such as Traction Engine Rallies and Railway Events but I would not equate them with Car Boot Sales.
Once an item is listed on ebay how can Alex or indeed anybody else know that they have been Free Listed or Paid to be Listed except perhaps by the date when they were listed. So on Sunday most of what I listed were Free Listings but once they ran out I listed a couple of other items which I paid for. I challenge Alex to be able to tell them apart.
i thought the free listing promotion was only for private sellers not business sellers selling new stock
I always look at my competitors stock levels and review their stock level against my selling rate for that product. So if they are cheaper, but hold low stock I might just let them sell out. I appreciate that this doesn’t work if they restock soon, but I’m never in a race to be the cheapest.