By Anton Ressel, ORT Jet
Arriving at the ‘right’ price for your products or services can be easier than you think.
One of the most common challenges entrepreneurs face is figuring out how to price their products or services correctly. It’s not surprising — while costing is a relatively exact science, pricing is shaped by psychology, perception, and context.
Your price depends on many moving parts: your target market, brand strength, product/service quality, packaging, availability, and even inflation or supply chain trends. It can feel like you need to be an accountant, marketer, and mind reader all in one!
It doesn’t have to be that complicated. By following a few core principles, you can find a pricing strategy that’s fair, sustainable, and profitable. Here are some tips:
1. Know your costs
This is the foundation of every pricing strategy. If you don’t know what it costs to make or deliver your product or service, you’re guessing – and that’s risky. Understanding your full cost structure (materials, labour, overheads, time) allows you to set prices confidently, protect your margins, and spot inefficiencies early. Without this, you can’t plan for growth or sustainability.
2. Focus on value, not just price
Most customers don’t always buy the cheapest option – they buy what feels worth it. In tough economic times, people still pay for convenience, trust, or quality. The key is to communicate value clearly. That could mean offering a guarantee, loyalty rewards, quick delivery, or excellent after-sales service. When customers feel they’re getting more than just a product or service, price becomes less of a deciding factor.
3. Discount with intention
Many small businesses make the mistake of discounting too easily, especially to attract or keep customers. But discounting eats into profit fast. For example, if your gross margin is 30% and you offer a 10% discount, you’ll need 50% more sales just to break even…
Instead, make discounting a two-way exchange: if you give a discount, ask for something in return – a larger order, faster payment, a longer contract, or a referral. This keeps the transaction balanced and sustainable.
4. Be ready to defend your price
Confident pricing comes from believing in your product or service, and knowing your worth. Be clear on what makes your offering different, understand your competitors, and be able to articulate your unique value. When a buyer challenges your price, explain why it’s fair – and don’t be afraid to walk away if it’s not viable. A short-term loss is better than building a reputation for being cheap.
Pricing is part numbers, part mindset. Blend sound costing with strategic thinking and self-belief, and your pricing will not only cover your costs – it will leverage the strength of your brand, attract the right customers, and drive
sustainable profit. ●
Anton Ressel is a business strategist, mentor and coach with over two decades of experience in helping entrepreneurs achieve new levels of success.
ORT Jet empowers entrepreneurs through mentorship, training, networking and business talks to build stronger South African enterprises. Using a proven approach, ORT Jet supports founders on their business journey. Visit ortjetcapetown.org.za
ORT SA Cape Jet http://www.ortjetcapetown.org.za
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