As a manufacturer, creating an effective pricing sheet for retailers who will buy and resell your products is one of the most important business decisions you can make. You might sell the best products in your industry, but if you don’t set sustainable, profit-generating prices for your products, ultimately your business will fail. Factors to consider when making your pricing sheet include your production costs, what customers are willing to pay for your product, what your break-even point is, what your competition charges, and how much profit you want to make on the sale of your items.
Open a spreadsheet data software program that allows you to create lists and formulas. Format your pricing sheet in an easy to read font and black ink so that it can be clearly read. Label the top of your sheet as the current year followed by “Pricing Sheet.” Label the far left column “Items.” Label the next column “Production Costs.” Label a third column next to Production Costs as “Selling Price.”
Open a second sheet in your Pricing Sheet file and label it “Production Cost Breakdown.” List what you spend on tools, equipment, utilities, labor, rent, taxes, materials, packaging and advertising. List out any item-specific costs if you sell multiple items. If you sell items that you do not produce, include the cost you pay for each item. Label each column as a separate production cost.
Save your file and click back on the first sheet labelled “Pricing Sheet.” List all of the products you sell in the rows beneath the far left column. Enter production cost figures you calculated for each item in the second column by creating a linked formula cell for each item that adds the production costs from your "Production Cost Breakdown” sheet.
Add your production costs, making sure that they include materials, overhead and labor costs. Add the profit that you want to make on each item, in dollars, to production costs. Divide that sum by the number of units you sell for each item. For example, if you sell single items and want to price them individually, use the following formula to determine your selling price: materials + overhead + labor + profit / by 1 = $/unit.
Enter a selling price for each item, in dollars, in the far right column. Create a linked formula in that cell that divides the sum in the cell to the left by the number of units you sell of each item. Save your file and print it. When one or some of your production costs change, update the figures in your “Production Cost Breakdown” sheet to automatically reconfigure your selling prices.
- Photos.com/PhotoObjects.net/Getty Images