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Calculate Your True Cost Before Setting a Selling Price

The purchase price from a supplier is only one part of cost. Packaging, transport, labour, electricity, payment fees and wastage can all reduce the margin.

Presency Team · · 1 min read

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Calculate your cost before setting a price. Include transportation, packaging, electricity, labour and other hidden costs.

What to do

  • List every direct cost required to get one unit ready for the customer.
  • Allocate a sensible portion of recurring operating costs when setting prices.
  • Decide the minimum margin the product should produce before discounts.

Watch out for

Pricing by copying a competitor can fail because your supplier terms, location, packaging and operating costs may be completely different.

Example

An item bought for ₦4,000 may really cost ₦5,100 after transport, packaging, payment fees and handling. Pricing from ₦4,000 alone gives a false margin.

Structured product and sales records give Presency merchants a better base for reviewing whether prices still make business sense.

Start selling free

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