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price for profit
COST PLUS vs VALUE
Let’s start the party by reviewing the difference between the Cost Plus and the Value pricing models. You may have seen these two before, but didn’t realize that they had names. Cost Plus This isn’t too hard to figure out as the price is derived from the costs for the item. Typically in this industry the cost of the garment is marked up by a standard percentage, and then the cost for decorating the item is added to it. The final sum of those two items equals the price given to the customer. You’ve seen that I’m sure. Where shops get lost is when they second guess themselves, or worse use the “average of ten shops in our area” to build their pricing. We will get more into why that is an unbelievably bad idea later. Value Pricing Believe it or not, this isn’t pricing your work at a discount. Rather Value Pricing is building your pricing strategy based on the perceived or estimated value that your customers have for your work. Sure, you still are going to use information to help drive the basic foundation for the price, but your Brand’s value adds a significant portion to the price.
You don’t have to sell with rock bottom pricing just because you are a garment decorator.
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