Setting price is one of the biggest challenges and also one of the biggest shortcomings of executives. So know that you are not alone when faced with pricing dilemmas. To help in this matter, the professor of Entrepreneurship and Marketing at FECAP, Artur Motta, has separated the tips below to help entrepreneurs in this important point of any business. COST AND REVENUE ANALYSIS The starting point of pricing is cost analysis, as revenues below expenses make the business unsustainable in the long run. Next, it is necessary to assess the entrepreneur's goals, such as asking whether “I want to have a large number of customers quickly” or “I prefer to obtain a premium position with few and selected customers”? You must assess whether there are customers interested in your offer and also the number of them. Competitive analysis is also important, as it establishes market price levels, levels that are often the reference for many customers. ANALYZE THE COMPETITION Analyzing the competition is a basic premise for pricing, but the number of variables involved makes the process complex. Initially, it is important to highlight that there is no single rule for all businesses, as entrepreneurs' goals are usually different. The starting point for the analysis of the competition is the gathering of information, such as the quantity and location of the competition, the price charged, the forms of payment, the agreements accepted, among others. ANALYZE THE TARGET AUDIENCE The target audience is critical for setting the price correctly. When defining the price, we must study the target audience in three main aspects. First, we have to assess the target audience we want to reach. Defining it correctly and understanding it is fundamental to the second aspect. Second, we need to identify what the target audience wants and is willing to pay for. In this item, it is important to identify which needs are not yet met so that we can position ourselves differently. Third, it is necessary to assess whether the target audience we aim to serve, and the way we aim to serve, has convergence with our business. Will it have the size and use the service as our sales need? Is there room for our business in the competitive market for this audience? Will we be able to speak and reach this audience with our proposal? Would he react positively to learning of our proposal or is he satisfied with existing proposals? However, we must also observe aspects that interfere in the customer's choice and, consequently, in the formation of the price. Opening hours, location, discounts, forms of payment or home delivery are differentials that can make all the difference when a customer chooses your service or business.

Read More: product specialist salary