Shopland Health Podcast

Ep #40: Pricing Worksheet 

SHOPLAND HEALTH EP #40: PRICING

Financial Terms

Here are some common financial terms you should befamiliar with. Retail (Selling) Price - Price of product that theConsumer will pay.  Use Retail Price exercise tocalculate. Cost of Goods (COGS) - What you pay to produce theproduct.  All costs associated with producing yourproduct.  Use the Cost of Goods exercise to calculate. Gross Margin - Difference between the Retail Price andCOGS Margin (Percent) - Gross Margin divided by Retail Price. Wholesale Price – What someone who sells to theconsumer pays.  A retailer.   You would use this price ifyou are selling directly to a retailer.  Distributor Price – What someone that sells to theretailer pays. A distributor sells to multiple retailers.  You would use this price if you are selling to adistributor

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SHOPLAND  HEALTH EP #40: PRICING

RESEARCH SIMILAR AND ALTERNATIVE PRODUCTS TO DETERMINEYOUR RETAIL PRICE

Similar Products closely match your product in form and function. Alternative Products perform the same function, but are in a different form. Product Name: Package Size: (ml, oz, gr, lbs, units) Form: (liquid, tablets, powder) Location: (store, online, Retail Price: Price per unit: Price per use: * Review a minimum of 3 products that are Similar or Alternative. 

Retail Price

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SHOPLAND  HEALTH EP #40: PRICING

USE THIS CHECKLIST TO TRACKYOUR COST OF GOODS SOLD

Cost of Goods

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SHOPLAND  HEALTH EP #40: PRICING

1. Raw Material (Ingredients) - Cost ofall ingredients:  bulk & per unit 2. Packaging - Cost of container forfinished product, bottle, bag, tube: bulk & per unit  3.  Shipping - Cost to ship Raw Material& Packaging to manufacturer 4.  Storage - Cost to store rawmaterials 5.  Manufacturing - Cost tomanufacture your product 6.  Warehousing - Cost to storefinished product 7.  Distribution - Cost to send productto Consumer * Only track the costs connected toproducing your product.  Expenses aretracked separately.

Calculations

Here are some common calculations you should befamiliar with. Retail Price - $15.00/unit Cost of Goods - $4.00/unit Target Gross Profit - $1.00/unit Wholesale Price - Estimate at 50% margin $15.00 and a 50% margin (for the retailer) wholesaleprice would be $7.50 Distributor Price - Estimate at 30% $7.50 wholesale price and a 30% distributor fee yourDistributor Price would be $5.25. The secret formula for calculating whether yournatural product will be profitable or not. Take your selling price and multiple it by .30.  If yourCOGS is less then that, then let’s talk. $15.00 * .30 = $4.50 Your COGS is $4.00 and your COGS is below the $4.50. However, if you wanted to make $1.00 per unit, are youcomfortable with only $0.50/unit?

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SHOPLAND  HEALTH EP #40: PRICING

C R E A T E A N D S E L L N A T U R A L P R O D U C T S

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THE TIME 

HAS NEVER BEEN BETTER TO