10 March 2020
Top 5 tips on pricing your new OFFPRICE purchases
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You did it! You attended the OFFPRICE Show in Las Vegas, or visited OFFPRICE365.com, and wrote several product orders with exhibitors while you were there. A few weeks after, the shipments are starting to arrive, and products look amazing. Now what?
Figuring out how to price your new finds isn’t always easy, especially since the apparel, footwear, or accessories you found at OFFPRICE were so sharply priced to begin with. What’s important is to find a balance where you, as the retailer, pass along the savings to your customers, but also make a reasonable profit for your business.
It’s not always a cut-and-dry mathematical equation to calculate the right price. Shopify recommends doing some investigation before pricing. “If your target customers are more budget-conscious or looking for a high-quality, high-end product, these are also factors to keep in mind when conducting market research,” says Alexis Damen, contributor for Shopify. Purchase products that fit within your shoppers’ budgets, but also look around online to see comparable pricing—because you know your customers are!
“If you price your stock on math alone, you’re losing out on profits derived from the quirks of human nature,” says Amy Allen, digital copywriter for Shopkeep. Allen explains the importance of keeping “value perception” in mind when tagging your new inventory. Consumers already have an understanding that some pieces of apparel, footwear, or accessories have a higher cost than other items.
“Customers tend to spend more on certain types of products, like outerwear, so you can mark those up more than, say, a t-shirt,” says Allen. “The location of your shop also matters. If you’re based in an area with lots of tourists, those customers may be willing to spend more than locals.”
Scarcity and supply
Keep a pulse on the other small business in the area, or your competing e-commerce retailers, to see if any products you’re selling are unique to your store. If they can find a similar product down the road, you probably need to have competitive pricing.
However, if you’re selling an item that likely can’t be found elsewhere, you can mark those products at a higher price point. Consumers will be more willing to pay a little extra, for a gift for themselves or others that they’ve never seen before.
Time is money
Christy Wright, Founder of Business Boutique, reminds retailers to include their time invested when pricing merchandise. “This includes the time spent on the phone taking and writing the order, preparing, creating, cleaning up and boxing the order, as well as shipping, sending receipts, billing the order and so on,” she says. “Those are work hours and you need to include them in your price.”
Whether you’re buying more merchandise online through OFFPRICE365.com, or in-person when you attend OFFPRICE trade shows, keep in mind your costs related to shipping, travel, lodging and more, when acquiring the goods.
Do your due diligence on getting customer feedback as well. Is your merchandise sitting on your shelves for too long? Do certain products only sell when hitting the clearance rack? If you’re not having a healthy flow of inventory through your store, consider that pricing could be your hang up. Test different price points to find your sweet spot, that rewards you with the profits you deserve.