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Running a Business

 
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QuestionSOFTWARE MARKETING TIPS Pin
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QuestionHow your software company can benefit from the Microsoft Partner Network programs Pin
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QuestionRegNow - A Company Beneath Contempt: A Study in Fraud, Negligence and Incompetence [modified] Pin
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AnswerNever use RegNow or Shareit Pin
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QuestionBusiness Question [modified] Pin
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AnswerRe: Business Question Pin
Snowman5818-May-09 8:43
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GeneralRe: Business Question Pin
wes2118-May-09 8:59
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GeneralRe: Business Question Pin
Snowman5818-May-09 9:23
Snowman5818-May-09 9:23 
I am not sure what your business model is, so I have no idea what the acceptable returns would be.

Your pricing model should be value driven not margin driven. If your costs are higher than your competitors your customer will not pay a higher price (unless you offer more value). Conversely if your costs are lower than your competitors, you want to reap a higher margin while giving the customer competitive value.

Your need to look at competitive pricing, evaluate how you stack up and make a judgement of how the customer will rate your offing vs others. If you are new to the market you will have to discount to build a customer base.

Once you know what your customer is willing to pay (market price or less) you can evaluate your costs and figure out your margin. If it is poor, you get out of the business. If it is great, you might expand. But either way your costs have virtually nothing to do with the price the customer is willing to pay except as the costs drive the competitive market place.

Hope this makes sense.

Melting Away

www.deals-house.com
www.innovative--concepts.com

GeneralRe: Business Question Pin
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wes2118-May-09 9:57
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Snowman5818-May-09 14:05
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QuestionSelling my software..... please help! Pin
Rajdeep.NET is BACK3-May-09 23:05
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AnswerRe: Selling my software..... please help! Pin
mindserve7-May-09 4:52
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AnswerRe: Selling my software..... please help! Pin
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