What to charge?
This has always been and may always be one of the most difficult decisions you can make in business and one I knew would be important to touch on in this series of posts on marketing for farmers and farmer’s markets.
Here’s the most basic I can make pricing:
If you’re getting a lot of onlookers and no one’s buying? It might be a sign your price is too high.
If you’re selling out before the end of the day and getting no complaints on the price? It might be a sign your price is too low.
If you charge a lot more than what others are charging for similar things or a lot less, people may be suspicious and want to know your reasons. So, unless you’ve got a very clear logic behind a huge difference in price between yourself and your colleagues, it’s wise to keep the prices within roughly the same ballpark.
Remember that, for whatever reason, pricing in ‘odd cent increments‘ (particularly the numbers 7 and 9) seems to get a better response from people looking for a bargain. You’ll sell more for 49 cents than 50 cents, more at $1.79 than $1.80. I have no idea why this is true but it seems to be.
But, if you price in five cent increments, it will tend to suggest higher quality and premium value.
Why? I have no idea. But this is what I’ve heard.
Also if you offer a discount for bulk buying (e.g. It’s $5.50 for one but only $10 for two then people will lean towards buying two).
You might also considering offering a two tiered pricing system – one price for your best quality stuff and a discounted price for the wares that are slightly less so.
Whatever you do, don’t devalue it. Sell it for more than you would at a grocery store. There can be a temptation to charge less than the other vendors at your market and undercut them but this can actually create the perception that your product is lower quality than theirs and create ill will between you.
It might also be wise to have a concise, convincing and clear answer ready for people if they challenge you with, “Why do you charge what you do?” Genuinely, take five minutes to sit down and really articulate this so you don’t stumble when asked. If you can give an honest answer that makes sense to people it will earn their respect and increase the perceived value of your products.
Please leave any thoughts, tips, resources or ideas that could help farmers grow their businesses in the comments section below. After a few weeks, I promise to read through them all and weave anything relevant and useful into the blog itself so that they can be of the most use to the most farmers.