Help with pricing strategy required

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   Hi, 

Currently in the process of revamping our drop shipping site but would like some advice on a pricing policy/strategy.

In the past we have simply taken the cost price, added the 10% 1on1 handling charge and then applied an X % increase (which is our profit).
This however does not take into account the retail price (perceived value of the product)

e.g. 

Product A - Cost Price �3 - RRP �5
Product B - Cost Price �3 - RRP �10

There is more profit to be made from product B however with our existing formula this is not taken into account.

Can anyone advise a better way to calculate our prices?

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Dita Members Profile Send Private Message Find Members Posts Visit Members Homepage Add to Buddy List Newbie Joined: 05 Dec 2007 Location: United Kingdom Online Status: Offline Posts: 15	Quote Reply Topic: Help with pricing strategy required Posted: 05 Dec 2007 at 4:42pm
	Hi, Currently in the process of revamping our drop shipping site but would like some advice on a pricing policy/strategy. In the past we have simply taken the cost price, added the 10% 1on1 handling charge and then applied an X % increase (which is our profit). This however does not take into account the retail price (perceived value of the product) e.g. Product A - Cost Price �3 - RRP �5 Product B - Cost Price �3 - RRP �10 There is more profit to be made from product B however with our existing formula this is not taken into account. Can anyone advise a better way to calculate our prices?

Saleman Members Profile Send Private Message Find Members Posts Visit Members Homepage Add to Buddy List Newbie Joined: 02 Nov 2007 Online Status: Offline Posts: 9	Quote Reply Posted: 27 Dec 2007 at 2:50pm
	Hi, Are you working your profit percentage in Excel or a program like that?

Dita Members Profile Send Private Message Find Members Posts Visit Members Homepage Add to Buddy List Newbie Joined: 05 Dec 2007 Location: United Kingdom Online Status: Offline Posts: 15	Quote Reply Posted: 02 Jan 2008 at 10:41am
	At the moment our formula is hard coded into the website. We could use Excel if required.