Something that seems boring, will really become boring if you look at it that way. So, no matter how dizzy you are already when having some class, fight that feeling within you. Take a deep breath, and hold it for a few seconds and then breathe it out. Just don't make it obvious because your teacher and classmates may think something else about you based on what you are doing.
Going back to the topic, I have prepared an article about Marketing, Pricing, and something else you may want to know. I do not only encourage you to read it, but I also want to share knowledge with you and hope you will grasp something today, especially if you are planning to put up your own business in the future.
Deciphering Marketing
Marketing means to make research on the demand of the product that can accomplish the objective market. This is necessary because it manages the attainability of the product in the market. With this, promoting projects for the business can be planned which is useful in making the business effective.
In particular, this segment demonstrates the potential market, promotion, location, pricing, product, direct competitors, the difference to other products, pricing strategy, demand analysis, and also the supply analysis.
Dive deeper into the Strategies for Setting a Price
These strategies are used to set the price of a certain product. For the purpose of explaining it better, let's take Mani con Macaroni from A Taste of Mani con Macaroni as an example.
First, you should determine the ingredients for the product. You have to list specific ingredient quantities, brands, and the number of servings the ingredients makes.
Example:
Nuts
Macaroni
Condensed Milk
Evaporated Milk
Flour
Half dozen eggs
Cooking Oil
Sauce
Up to 120 servings
Second, you have to determine the price for every ingredient specific to the quantity required.
Example:
Nuts - P100
Macaroni - P150
Condensed Milk - P50
Evaporated Milk - P50
Flour - P50
Half dozen eggs - P30
Cooking Oil - P100
Sauce - P100
Third, you have to create a pricing sheet for the product. Add all of your incurred expenses including labor, rent, cleaning costs, supplies, and all other routine expenses, if any. You need to summarize the cost of ingredients and then divide by the number of products (e.g Mani con Macaroni) you made.
Example:
Total Cost - P630
Labor - P350
Grand Total Expenses - P980
Fourth, you need to summarize the cost of ingredients and routine expenses and then divide by the number of products (e.g Mani con Macaroni) you made.
Example:
Grand Total Expenses - P980
Divide by number of pieces made: 140
Cost of ingredients per piece: P7
Fifth, you then need to determine the average number of customers that come to your establishment. If you don't have an accurate count, you have to substitute the number of entrees ordered by customers.
Example:
50 Customers
Sixth, you should divide the total expenses by the average number of customers to determine the number of expenses that each customer order must cover.
Example:
Total Expenses: P980
Divide by: 50
Amount of expenses that each customer order must cover: P19.60Using the cost of ingredient per piece which is P7, one customer should buy at least 2.8 or 3 pieces to cover the amount of expenses that each customer order must cover.
Seventh, you have to determine the percentage of profit you want to make on each item. You may consider testing profit price points by multiplying 1.1 (if you want 10 percent markup), 1.2 (20 percent markup), or 1.3 (30 percent markup), or any percentage you want by the total expense to illustrate the cost of each item.
Example:
Cost of ingredients per piece: P7
Multiplied by desired percentage (40%): 1.4
Price per piece: P9.80This means that you have a profit of P2.80 per piece.
Lastly, you just have to compare the price with similar products in your area and then select the profit level that meets your desires, but is still priced competitively.
If you have any questions in mind, feel free to ask me. I will get back to you once I read your comment. The tone of this article, if you have noticed, is not the same as the other articles I have published. It is more formal and explanatory. I add a bit of humor to at least make the atmosphere lighter and more comfortable to read. I hope it helps you have an idea of how you can thrive with the business you are planning to put up after reading this post.
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Thanks to my readers and sponsors for following my publications. May God bless you a hundredfold. Also, this is original content. Most of the photos I use are free images from either Unsplash or Pixabay.
This is so informative. Gonna save this one for future references.