Costing & Pricing

Costing and Pricing for Export

Costing and pricing are an important part of the product development processes. It is important that you know what the actual costs of making a product are before you begin negotiating orders with buyers. This section will help you to look at how to calculate production and overhead costs and what you need to keep in mind when determining your selling price.

Costing is the process of calculating all of the expenses involved in making and packing a product.

Pricing is the process of determining the amount of money for which your product will sell.

Why are Pricing and Costing important? 

Pricing and Costing are important on-going activities for any business. If a business does not know the true cost of making a product, they may be selling at a loss. If a business prices their product without looking at the current situation in the market, they may price the product too high, and have difficulty selling.

Costing and Pricing are important:

• to be profitable
• to be competitive in the marketplace
• to make good business decisions
• to be successful