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Relating Products and Services to a Customer's Spend
Should products and services be tied to the customer’s smallest spend?
By Emma Meakin
When it comes to designing products and services, profit margin should always be at the centre of your pricing strategy. Keeping costs low and marking up your products and services by an amount that will cover these costs, and deliver a comfortable return at the same time, is the key to running a successful, lucrative business.
Don’t be tempted to price your products and services solely on people’s smallest spend, otherwise you may need to sell many times more products to reap the rewards. Stick to the principal that 20% of your customers make up 80% of your business. Otherwise you risk being busy yet unprofitable.
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