Hello people!
I have a little doubt: I tried to search on google, but I didn't find much, so I think the best place is to ask here. Maybe I find someone who has gone through this process and knows how to give me a right input.
I would like to produce an educational game to see if there is a demand in the market. The problem is that I've always worked with online products (creating websites, landing pages, ebooks, virtual products, etc.) and so I'm going through the jungle of physical products, shipping and suppliers.
While with virtual products the costs are at a minimum, with physical products it is totally different: you have the cost of production, the cost of storage and logistic and the shipping cost.
I am currently calculating production, storage and shipping costs, and I have to decide the final price of the product (thinking also of promotion costs and final profit, of course!)
Here the question: to make everything sustainable, is there a rule that profit must be a certain percentage of production and shipping costs?
Let me explain: if I know that the cost of production, storage and shipping of the product is $ 9 total, should I sell the product for $ 18, so costs and profit are x = x? Or there is a rule that if the costs are x, then the profit must be 2x (so in the example above, the final price of the product should be $ 27)?
It seems a ridiculous question, but it is a doubt.
I mean, I know that reducing costs to increase profit is fundamental. But I'd like to see if there are some market practices.
I can look for other suppliers, try to reduce the quality of the product or raise the price: I can choose a lot of variables. And as happens when there are so many choices, there is indecision.
I wouldn't want to lower the quality of the product or raise the price once the sales process has started, so knowing it now could make my life easier. So I hope someone can give me feedback, it would be useful!
PS. Sorry If I did grammar errors, but I'm not a native English speaker.
I have a little doubt: I tried to search on google, but I didn't find much, so I think the best place is to ask here. Maybe I find someone who has gone through this process and knows how to give me a right input.
I would like to produce an educational game to see if there is a demand in the market. The problem is that I've always worked with online products (creating websites, landing pages, ebooks, virtual products, etc.) and so I'm going through the jungle of physical products, shipping and suppliers.
While with virtual products the costs are at a minimum, with physical products it is totally different: you have the cost of production, the cost of storage and logistic and the shipping cost.
I am currently calculating production, storage and shipping costs, and I have to decide the final price of the product (thinking also of promotion costs and final profit, of course!)
Here the question: to make everything sustainable, is there a rule that profit must be a certain percentage of production and shipping costs?
Let me explain: if I know that the cost of production, storage and shipping of the product is $ 9 total, should I sell the product for $ 18, so costs and profit are x = x? Or there is a rule that if the costs are x, then the profit must be 2x (so in the example above, the final price of the product should be $ 27)?
It seems a ridiculous question, but it is a doubt.
I mean, I know that reducing costs to increase profit is fundamental. But I'd like to see if there are some market practices.
I can look for other suppliers, try to reduce the quality of the product or raise the price: I can choose a lot of variables. And as happens when there are so many choices, there is indecision.
I wouldn't want to lower the quality of the product or raise the price once the sales process has started, so knowing it now could make my life easier. So I hope someone can give me feedback, it would be useful!
PS. Sorry If I did grammar errors, but I'm not a native English speaker.
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