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Putting a price on your products

Posted on October 30, 2016 by admin

Pricing a business’s products or services can be a difficult task, even for the most experienced business person. This is because the price a business charges its customers can have a direct effect on the success of the business, no matter the type of product or service being sold.

Getting your pricing right can enhance sales, ensure profit and increase customer retention rates. Getting it wrong can create a number of problems for a business that can be hard to overcome – even in the long run.

Pricing of products and services needs to take a whole range of factors into consideration. Many small businesses typically approach setting a price by considering the cost of the goods plus a percentage, establishing what customers are prepared to pay and keeping an eye on competitor pricing.

Here are three things to consider when establishing the right price for your business:

– Know your costs. Work out how much it costs the business to provide a product or service. This includes costs of delivery, total overheads, sales and marketing expenses.

– Determine how much your target market will pay for the product or service. Market research is often a good resource to find out how much customers are prepared to pay for things.

– Know what your competition is charging. It is highly likely that your target market will also be comparing the competition’s price to your own. Consider whether your product or service offers more or less value – if so you may be able to charge more or may have to charge less.

maximise your business's value

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Government increases cash flow support for businesses

Posted on March 27, 2020 by admin

The Australian Government has increased support for businesses to manage cash flow challenges under the ongoing COVID-19 circumstances.

The Boosting Cash Flow for Employers measure announced on 12 March 2020 will be increased to provide up to $100,000 for eligible small and medium-sized businesses. To be eligible employers must have been established prior to 12 March 2020 and have an aggregated annual turnover of less than $50 million and employ workers.

The measure will provide employers with a payment equal to 100% of the tax withheld from wages and salaries. This is a rise from the original 50%, with maximum payments being increased from $25,000 to $50,000 and minimum payments being increased from $2,000 to $10,000.

Employers will receive payments from 28 April 2020 from the ATO as automatic credit in the activity statement system upon lodging eligible upcoming activity statements.

Eligible businesses will be provided with an additional payment during July – October 2020. The payment will be equal to the total amount received under the Boosting Cash Flow for Businesses scheme. For monthly and quarterly activity statement lodgers, these payments will be provided as automatic credit in the activity statement system for each lodgement up until October 2020.

The Government has also introduced the Coronavirus SME Guarantee Scheme to support the flow of credit for small and medium enterprises (SME) by providing a guarantee of 50% to participating SME lenders for new unsecured loans that will be used for working capital. To be eligible, SMEs will have a turnover of up to $50 million and the loans must comply with the following terms:

The SME Guarantee Scheme will still require businesses to repay these loans and approval is subject to regular lending requirements. The Scheme will commence by early April 2020 and be available until 30 September 2020.

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