pricing strategy

[randy41]

the scenario is that you are at the local farmers market. a vendor is selling strawberries for $6/qt, 2 for $10. This makes you buy 2 quarts. If the vendor were selling them for $5/qt you would just buy one. what do you think?




the vendor is me. last week i was at a bigger market than i will be at this week and i think i'm at the upper limit of what i can sell at this smaller market.

 

[Steppenwolfe]

One thing you forgot, and the most important... How good are the strawberries ???

 

[randy41]

One thing you forgot, and the most important... How good are the strawberries ???

i grow them and they are great. many repeat customers, some within a few minutes of their previous purchase.

 

[Jstpssng]

A couple of questions...
A) do you have any problem selling out?
B) are you raising your price to give the "2 for" price?

 

[randy41]

A couple of questions...
A) do you have any problem selling out?
B) are you raising your price to give the "2 for" price?

i never brought this many to this market. this is a big ebt market and since it is the beginning of the month that should work in my favor.
my previous price was $6/qt. i sold 5 flats 3 weeks ago at this smaller market and almost 6 flats 2 weeks ago. i went to the other market last week.

 

[motownbrowne]

If you don't have a problem selling out at $6/qt, then I'd stick with that. If you have a lot more supply than demand, then your plan sounds good. One other thing you could try is $6/qt with a price break for a flat. That ought to tempt the jam/jelly makers. We're about 2 1/2 weeks from daiquiri err, I mean strawberry season here... Can't wait.

 

[randy41]

i have 51 quarts and 32 pints. should be challenging to sell all.

 

[Stimw]

I go to several local flea markets and they always have the "2 for less" price on produce.
I usually go for the $2. basket of tomatoes or 2 for $3. When I find excellent tomatoes I buy the 2 baskets and give the extras to friends. Everybody loves a good tomato!!
If you have product to move it's a good incentive and I just consider it volume pricing.

 

[wroughtn_harv]

Interesting quandary. The concept of volume discounts works in business to business sales because both sides understand the cost of handling etc. In your situation it is all about marketing and one has to wonder about all of the other components that should be considered. For instance, what are the competitors pricing their products and is it customary for the volume price cut? Another thing would be about the valuation of your time, let's say you sell out in half day and you're given away a hundred dollars with the volume discount. Is that $100.00 what you would pay to have the other half the day free?

 

[randy41]

and the results are in. i sold out of everything i brought to the market. my incentives cost me about $70. its also possible i messed up in change making which could contribute to that difference. i don't think i could have sold out without some incentives. but as harv pointed out i saved a lot of time over going to the other market (at least 3 1/2 hours) as well as vehicle expense since this market is much closer. and way less stressful.