There are various ways you can decide how to price your products, however, the most common way to calculate your retail price is: costs + profit.
The prices displayed in the Selfnamed catalogue are production prices excluding VAT charges. These, together with shipping costs, make up the total amount you pay for a product.
The amount of profit you will make per sale depends on your product's retail price. It is completely up to you to choose the retail price you wish to set. However, we recommend a minimum profit margin of 40% to ensure steady business growth.
An example:
You decide to sell Calming Facial Oil, which at Selfnamed costs EUR 14.60 (price for one unit, excl. VAT), with a 60% profit margin. This would give you a profit of about EUR 8,76.
You buy it for: EUR 14.60
You sell it for: EUR 23.36
Your profit is: EUR 8.76
Profit percentage: 60%
Now let's explore a scenario where your business has grown, allowing you to purchase in larger volumes and thereby increase your profit margins.
Assuming the RRP remains the same as before, at EUR 23.36:
For 250 items:
Bulk buy price per item: EUR 10.22
RRP: EUR 23.36
Your profit is now per item: EUR 13.14
The profit margin percentage is approximately: 128.57%
For 1000 items:
Bulk buy price per item: EUR 8.03
RRP: EUR 23.36
Your profit per item: EUR 15.33
The profit margin percentage is approximately: 190.91%
By purchasing in bulk, you significantly increase your profit margins. This demonstrates the financial benefits of scaling up your business operations.
This structured approach ensures clarity in your pricing strategy, allowing for a transparent understanding of your costs, profits, and pricing objectives.
Remember to check your prices regularly, as they can fluctuate due to demand, expenses, or unforeseen costs.