Costs Comparison and Generate Rate

[sorpasso]

Hi,

I am trying to find the way to compare products costs between 3 vendors against mine and generate a sell rate with the best profit possible. So, for example the best competitor cost is $1 and mine is $ 0.50, I want to generate a rate to be close and below to $1. Do you know any macro or formula for it? The trick is that my costs may be higher than any of these vendors' cost in certain products.


Thanks,
Sorpasso

 

[Joe4]

Welcome to the Board!

I think we need more information, like what is the relationship between change in price and change in demand. Also, there are fixed costs and variables cost that are usually considered.

In an oversimplified state, it would seem that the rate that generates the most profit would be to sell for $0.01 less than the lowest competitor, provided you still turn a profit at that price (but that is assuming some very basic assumptions, such as consumers are looking strictly at cost and not including factors like quality, loyalty, convenience, etc).

 

[sorpasso]

Welcome to the Board!

I think we need more information, like what is the relationship between change in price and change in demand. Also, there are fixed costs and variables cost that are usually considered.

In an oversimplified state, it would seem that the rate that generates the most profit would be to sell for $0.01 less than the lowest competitor, provided you still turn a profit at that price (but that is assuming some very basic assumptions, such as consumers are looking strictly at cost and not including factors like quality, loyalty, convenience, etc).

Hi Joe4,

Thanks for your message. There is no relationship between change in price and change in demand, customers will see that our product is less expensive and will use it always knowing that our product quality is equal or better than our competitors' one. Yes, we have a variable cost per product, just imagine there are over 200 products or rows in my excel sheet.

Yes, that is the point, we would like to be less expensive and 1 cent less expensive is a valid value but, it could happen that our product cost is more expensive than the others though. Customers look at the value at this stage, as our brand is well-known. Thanks a lot and keep asking me if needed.


Thanks,
Sorpasso

 

[Joe4]

So I don't really know what to add to this. Without any precisely detailed information, we really cannot offer much of anything else.
If customers are going solely by price, then to maximize your profits, you would charge one cent less than your competitors (assuming that the price you are charging exceeds the cost to make each unit).
Otherwise, if you charge more than your competitors, they will by it from then and you won't sell anything.

Maybe that seems like oversimplifying things, but all you have given us is very general simplified information.

 

[sorpasso]

So I don't really know what to add to this. Without any precisely detailed information, we really cannot offer much of anything else.
If customers are going solely by price, then to maximize your profits, you would charge one cent less than your competitors (assuming that the price you are charging exceeds the cost to make each unit).
Otherwise, if you charge more than your competitors, they will by it from then and you won't sell anything.

Maybe that seems like oversimplifying things, but all you have given us is very general simplified information.

Hi Joe4,

Thanks and sorry. Here is a table with the 3 competitors and our costs. You will see that everybody costs are based on PC + KG units. On the right hand side I have created a costs comparison chart with a conditional formatting showing the best cost. Please, let me know if this is something more helpful or I will continue providing you with more details. Thanks a lot.



carrier example — imgbb.com

Thanks,
Sorpasso

 

[Joe4]

I cannot look at that link from my current location. Our corporate security department blocks those.
I may be able to look at it from a different computer later tonight.

 

[sorpasso]

I cannot look at that link from my current location. Our corporate security department blocks those.
I may be able to look at it from a different computer later tonight.

Sure Joe4, take your time and let me know if you have further questions, I really appreciate your help.

Thanks,
Sorpasso

 

[Joe4]

Sorry I wasn't able to take a look at it last night. Life kind of got in the way...

 

[sorpasso]

Sorry I wasn't able to take a look at it last night. Life kind of got in the way...

Hi Joe4, no worries, check whenever you can, and please let me know if this is clear now or ask me. Have a great Friday!


Thanks,
Sorpasso

 

[Joe4]

I see it, but I am afraid I don't really understand what it is I am looking at or how to determine what you are after.