Mark Up....

IP · #11 17-11-2009, 08:28 PM

I would totally agree with that.

Maslins · #12 17-11-2009, 08:29 PM

Quote:

Originally Posted by Cathy

Chubs, this may be very wide of the mark but as far as I'm concerned anyone who works out the mark up on every single item they sell either has too much time on their hands or they will seriously never make any actual profit because all they're concerned about is making enough money to cover their overheads.

Otherwise known as analysis paralysis!

Great post Cath

Agree entirely with this, and the rest of the post. I don't think "cost plus" is the best method of deciding how much to charge for what you sell. If people won't pay that much, it's pointless pricing it that way. Similarly if people would happily pay far more, you're missing easy pure profit.

Having said all that, I do think it's good to know roughly what you're making on each product, otherwise if you're not careful you may be selling some products at a loss.

IP · #13 17-11-2009, 08:43 PM

Quote:

If people won't pay that much, it's pointless pricing it that way. Similarly if people would happily pay far more, you're missing easy pure profit.

There is another way of looking at that Chris... Suppose you sell 4 similar products all set up on the same margin but with very different price points, you would be forgiven for assuming the cheapest sells in greater volumes, but you would invariably be wrong. So configuring a mark up model saves you losing customers from every sector whilst maintaining a standard level of acceptable profit.

Quote:

Having said all that, I do think it's good to know roughly what you're making on each product, otherwise if you're not careful you may be selling some products at a loss.

It again comes back to setting parameters and putting products in group categories, you have to understand the maths!

Chubster · #14 18-11-2009, 02:06 PM

Excellent post Cathy and why I am / was struggling with the whole concept....how could I possibly mark something up if I dont know how many I am going to sell in the coming months.

Anyways...I scanned the whole shop into my till yesterday....putting everything into groups so at least now I will have some exact figures to work with.

Maslins · #15 18-11-2009, 02:22 PM

Quote:

Originally Posted by IP

Suppose you sell 4 similar products all set up on the same margin but with very different price points, you would be forgiven for assuming the cheapest sells in greater volumes, but you would invariably be wrong.

Might create a new thread on pricing strategies which you can disagree with

IP · #16 18-11-2009, 02:26 PM

I will keep quiet

Cathy · #17 18-11-2009, 03:16 PM

Quote:

Originally Posted by Chubster

Anyways...I scanned the whole shop into my till yesterday.....

Now really Chubs, that is taking downsizing much too far!

Gyto · #18 19-11-2009, 01:18 AM

But surely you would take into consideration the bigger picture of all your range. As the mark up on some items maybe as high as 400% and others as low as 40 or 60% usually popular items. But we all have loss leaders thats what attracts the customers. But you just have to find a middle ground as some flyers compensate for this.
Ive been doing my paperwork this week hence the late nights. But am up to speed now and am a happy chappy. Wot recsession.

Mark Up....

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