Retail Pricing - how do you price a product??

Retail Prices and Business

For those of you out there who have not yet ventured into the world of retail I'm going to share with you a change in my mindset towards product pricing.
When I used to look at a product at the store, I would only think of how much it "cost" to make, you know, the materials used in it. And then think of how ridiculously priced things are. And now that my toe is in the water I have had a very real awakening. I have been reading this book called "How to Start a Home-Based Craft Business" and the author, Kenn Oberrecht, gives a very good basic formula for calculating how much each item costs.
Materials + Overhead + Labor +Profit = Price
Seems simple, right?
Labor $10/hour
Time per unit = 5 hours = $50.00
Materials per unit = $8.00
Overhead (indirect costs like your website, lighting, electricity, tools use) = $50 x 10%= $5
Profit = $62 x 10% = $6.20
Price per unit (wholesale!) = $68.20
What?! I seriously didn't ever think about this sort of thing before. I never understood before how many costs are really behind each product! I also realized that my original pricing didn't even include any profit, because I was thinking my labor wage was the profit. Even though the materials in the above scenario was only $8, with the other costs it becomes $62!!
Talk about turning my retail knowledge around! What an awakening!
So how do we have $1 products??? VERY low labor costs...  Which is a whole other topic that I will get into another day.
A few months ago I attended the KBA (Kingdom Business Association) Conference and was rocked (in a good way). I have a greater vision for business than I ever had previously. One great thing that was said by Rick Joyner is about the business advise with which you could never fail.
How can you never fail in your business??
1 Corinthians 13:8 he said... "Love Never Fails"
So if you love your products and are passionate about them, you love your employees, you love your suppliers, you love your customers, you love your boss, you love yourself... YOU WILL NEVER FAIL!!!!

Seek first the kingdom of God and all these things will be added unto you!!! Even if your technical business "fails" or goes under, if you conducted it with love, it is everlasting in the Kingdom that counts!
Now that gets me excited about business!!!!! So let's love! Let us love!

Check it out AJoy's Enterprise, LLC

(This is a post from my personal blog.)