Years ago, on a gift basket message board that no longer exists, a new gift basket designer asked,
“If I put $21 of products in a basket and sell it for $25, am I making a profit?”
Experienced professionals immediately let her know that such pricing would keep her in the poor house.
The new designer later confessed that the $21 did not include the basket, shred, enhancements, shrink wrap or bow. So, the actual price for her basket was more than anyone realized.
Profitable pricing has always been a big issue for designers, and because increasing the bottom line is a high priority, the formula to calculate costs is continuously reviewed.
How do you price your gift baskets? I began with a low pricing structure, which is unfortunately normal for many of us.
Today, I’ve developed three pricing strategies which many designers follow and are very pleased with the results. One of the options is extremely high, and the few who’ve decided to employ it say that their customers are happy to pay the price.
If you design in a home studio, your calculations will be different than the formula for designers in retail stores.
A wide profit margin between wholesale costs and retail prices ensures that you earn the highest profit possible while satisfying your customers.
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Shirley if it’s ok to ask what are the three pricing stageries you use?
Thanks, Sandra
The three pricing strategies I’ve documented are based on where gift basket designers conduct business.
Some are in a home office, while others are in commercial spaces and other facilities.