Structuring Your Pricing for Profitability: Real Talk for Product-Based Business Owners

Let’s talk pricing.

Not the kind of pricing where you take your product cost, double it, and hope for the best. And definitely not the kind where you check what your competitors are charging and undercut them by $2 because, “That’ll do.”

No, I’m talking about intentional, profit-focused pricing—the kind that allows you to confidently grow your product-based business without constantly feeling like you’re stuck on a cash flow hamster wheel.

As a retail strategist and consultant who’s worked with 70+ product brands (plus built a few of my own), I’ve seen just how many brilliant products fall short—not because they lack creativity or demand, but because the pricing is working against the business.

It’s time to shift your strategy—and your margins!

Start With the Foundations: Know Your True Costs

Let’s not skip the boring bits—because this is where the leaks start. You can’t build a profitable pricing strategy if you don’t know exactly what it costs to get your product into your customer’s hands.

And I don’t just mean the product itself. I mean:

• Materials or manufacturing costs

• Packaging (down to the ribbon)

• Fulfilment and logistics

• Marketing expenses (ads, photoshoots, influencers)

• Overheads like studio rent, subscriptions, and even your time

I call this the true cost of doing business. If you’re only factoring in product + packaging, you’re undercharging—and it’s your profit that’s paying for it.

📌 Pro tip: Use a spreadsheet (or my Pricing Troubleshooting Worksheet) to build out your full cost breakdown. Your future, better-paid self will thank you.

Don’t Default to Keystone: Move Beyond Cost-Plus

The keystone pricing method (doubling your product cost) is a starting point, not a strategy.

Why? Because it doesn’t consider perceived value, positioning, or demand. A product that costs you $20 to make might technically retail for $40, but what if your customer would gladly pay $55? Or what if you’re positioning yourself as a premium brand, and $40 makes you look mid-tier?

That’s where value-based pricing comes in.

Ask yourself:

• What problem does this product solve?

• How does my customer feel when they use it?

• How do I want my brand to be perceived?

If your product adds emotional value (e.g., confidence, convenience, joy), your price can and should reflect that.

Introduce Tiered Pricing to Boost Average Order Value

One of the smartest ways to increase profit is to guide your customers to spend more—without them feeling like they’re spending more.

Enter: tiered pricing.

Instead of offering a single option, create a Good / Better / Best model. Let’s say you sell skincare:

• $28 Basic Serum

• $42 Advanced Formula

• $59 Luxury Edition with Botanicals

Most people will gravitate toward the middle option, especially if it’s clearly positioned as the “best value.” You protect your profit margins and create choice without confusion.

And yes, this works beautifully for candles, ceramics, clothing, even prints.

Use Psychological Pricing Like a Pro

We humans are funny creatures. We think $49 sounds cheaper than $50. We gravitate toward the item in the middle. We love a bargain—but only if it feels like a bargain.

This is where psychological pricing can do the heavy lifting for you:

✨ Charm pricing: Use prices ending in 9 or 99 (e.g., $29.99 vs $30) to create a sense of value.

✨ Decoy pricing: Add a slightly less attractive third option to nudge customers toward your preferred product.

✨ Bundle pricing: Package complementary products together at a small discount to increase spend (e.g., Buy the set for $75 instead of $90 separately).

Small tweaks. Big difference.

Let Your Price Reflect Your Brand Positioning

Are you a luxury brand or an accessible go-to? Are you artisanal and limited edition, or high-quality and everyday?

Your pricing tells your customer who you are before you even say a word.

I’ve worked with brands who were selling gorgeous handmade pieces at cut-rate prices—and confusing their customers in the process. If your product looks and feels premium, but your price says “bargain bin,” you’ll lose trust, not just margin.

So, ask yourself honestly: Does my pricing match my brand promise?

If not, it might be time for a reset.

Test, Tweak, and Track Your Results

Pricing isn’t a set-it-and-forget-it task. It’s something to revisit regularly—especially as costs, customer demand, and market conditions shift.

Start small:

• Raise prices on your top sellers by 5–10% and track the impact.

• Test a new price point for your bundle or hero product.

• Offer a limited edition version with a premium price to gauge interest.

📌 Use tools like Shopify analytics or manual tracking to monitor changes in sales, margin, and average order value.

What Not to Do When Pricing Your Products

❌ Don’t price based on fear (i.e., “Will anyone pay this?”)

❌ Don’t price based on assumptions (i.e., “My customer won’t pay more.”)

❌ Don’t price to match your competitor’s discount strategy

Your pricing should serve your business goals, customer expectations, and profitability targets—not your inner imposter syndrome.

If You’re Still Guessing, It’s Time to Get Strategic

If this all feels overwhelming, that’s completely normal. Pricing can be emotionally loaded—it brings up questions about self-worth, market value, and risk. But when you get it right, the results are transformational.

✨ More cash flow.

✨ Less discounting.

✨ Stronger brand identity.

✨ Higher customer trust.

And most importantly—a profitable, scalable business that doesn’t rely on luck.

Let’s Build Your Profit-First Pricing Strategy

At CCConsultancy, I work with product-based business owners to remove the guesswork and build pricing strategies that actually support growth. Whether you’re launching a new range, repositioning your brand, or simply need to stop flying blind—I’ve got you.

👉 Book a 1:1 session, or explore our Free Checklists and Strategy documents https://ccconsultancy.shop/collections/free-resources

Because pricing shouldn’t just cover your costs. It should fund your future.