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How to set your product pricing

How to set your product pricing

One of the first things you need to do when you start your online store is to set your product pricing.

This can often be a confusing and daunting task as your pricing sets the tone for your brand and your products. 

At the end of the day you’re running a business not a charity, so you want to make money. And if you’re not making a profit, then it’s essentially just a hobby.

Price Perception

We’ve all heard the sayings “cheap and nasty” and “you get what you pay for” and trust me you don’t want to hear either of those in relation to your products.

Sometimes the reason people can’t sell their products is that they price them too low. They source great quality materials and create a beautiful product, but then try and compete on price with someone that’s imported questionable quality products from China. When someone sees their product and then the low price, they make the assumption about the quality based on the price. 

You don’t always have to set your pricing based on costs. Let’s take a look at the following black polo tops.


Ralph Lauren

Expensive Chanel Black Polo


The prices range from $8 – $3,380 but they are all made from essentially the same amount of material and they are all the same colour. The only real difference (aside from some quality) is the little logo in the corner.

When you’re buying a Chanel polo top, you’re not just buying a black polo, you’re buying the prestige of wearing a polo top that people know cost you thousands.

Although it’s not my cup of tea to spend $3k on a polo, some people LOVE Chanel and they will drop the coin without a second thought.

They are selling the brand, not just the polo. So you need to decide are you selling a commodity – a polo top – or a brand.

When you have a brand you can build a loyal following of people who love your product and are excited to see what you bring out next and have their wallet open ready to buy.

When you’re selling a commodity, you have to compete on price, because your product has nothing else going for it. And as Megan loves to say:

“When you compete on price it’s a fast race to the bottom”

So now that you know you don’t have to be the cheapest to succeed, let’s take a look at what do need to know to calculate your prices.

Your expenses

When you’re calculating your prices you do need to know how much your products are costing you. This includes variable and fixed costs.

Variable costs

Your variable cost change based on your quantity sold. The more you sell the more you can lower your variable costs. To start, set your pricing based on your higher variable costs, and know that when you sell more you can increase your profit margin or reduce your prices.

Variable costs include:

  • Branded packaging
  • Time to pack and send
  • Shipping costs
  • Raw materials
  • Wholesale prices

Tip: Contact your suppliers and negotiate a lower rate with them. If they say no, ask when and how you can qualify for a reduced rate in the future – get it in writing 🙂

Fixed costs

Fixed costs are the expenses that you’d pay no matter what, and that stay the same whether you sell 10 products or 1000 products. They’re an important part of running your business, and the income generated by selling your products needs to cover these as well.

Fixed costs include:

  • Your website
  • Internet
  • Rent & electricity for brick and mortar stores
  • Bank fees
  • Software subscriptions

Cost of goods sold is how much it costs you to get the product on your shelf taking into account all of the above.

Profit Margin

We like to aim for a minimum 80% profit margin.

You can use this gross profit margin calculator to work out what your retail price should be. As a general rule you want to aim for a minimum GPM of 60-80%. This is so you have money to reinvest in the growth of your business.

Market Research

Although it is important to do some market research and ensure there is demand for your products, please do not use this as your method for pricing your product.

People who buy based on price are also only loyal to price. So be aware of what the market is doing but set your pricing based on your brand and a healthy profit margin..

The only time this may differ, is if you’re wholesaling products which have a RRP or which many other people stock.

Too many times I see people post in a large Facebook group, usually a business group, full of people who are not their target market and ask them for advice on pricing – please stop. Unless someone is willing to put their money where there mouth is, this is not an effective way to gauge price.

Instead, pre-sell your products before you officially launch. Set your pricing based on all the other factors above and then load them onto your website for pre-sale. Then put your brand out there and see the reaction you get when they have to open their wallets.

Take a look at exactly how Megan did this for The Good Bag Project.

Discounting & Shipping

When it comes to shopping online, people hate paying for shipping. So when you’re first setting your pricing think about incorporating shipping into your costs if you can. Then you can offer free shipping, without losing out of profit.

Although regular discounting isn’t a good sales strategy, consider margin for discounting if you do plan on running seasonal sales or discount incentives.

Australia & GST

In Australia, all your pricing needs to be displayed including GST if you are registered for it. You need to either add this 10% on top of your pricing or absorb it.  If you’re not registered for GST  yet but think you may need to soon, I recommend factoring it into your pricing from day one, then absorb the 10% when you register for it, rather than not including it and then having to put all your prices up 10%. Until you register, simply enjoy the extra 10% and put it back into growing your business.

Own Your Price

When you arrive at your final price, write it down, say it out loud and make sure it feels good for you.  If you don’t feel it’s the right price, potential customers will feel that in your marketing.  Get comfortable with them, know your value and your worth.

When you set your prices, stand by them. Not everyone will be able to afford your products and that is OK. Not everyone is your ideal customer.



Want to learn more about this topic? Here are some other blogs we’ve written: 

Are your prices too low? 

Should I offer free shipping? 


Written by Karyn Parkinson

Karyn AKA Karyn with a Y is a Facebook ad specialist with a side dose of eCommerce marketing, particularly website optimisation.

When she's not behind the computer you'll find her at the beach with her fur babies or on the roller derby track as Pink Fury!

Facebook launches Shops

Facebook launches Shops

Today (Wednesday 20th May here in Australia) Facebook has launched Facebook Shops.

A new tool for businesses which allows them to set up a shop to sell via both Facebook and Instagram from today with Messenger and WhatsApp to follow. 

Shops were in the pipeline but Mark Zuckerberg today announced they moved up the launch date due to the effect of Covid-19 on business “I think this particularly important right now because so many small businesses are moving online to deal with the economic fallout from Covid-19. “

What are they?

Although Facebook already have the shop tab and Instagram shopping it seems the Facebook Shop rollout will be more of a built in eCommerce function of Facebook and Instagram.

You will be able to set a cover image and choose an accent colour to showcase your brand.

Your shop will be accessible on your Facebook page, Instagram profile and also linked to through stories and ads. Customers will be able to browse, save products they like and place an order. At this stage it seems the checkout process will need to go through your website unless you are in the US.

Although this is a fantastic opportunity for businesses without a website to start selling online, I don’t think it will be a suitable solution until the ability to process the transaction within the app is rolled out globally. If you still need to link to your website for checkout then it does not remove the need for one at all. 


What do they look like?

Facebook’s official announcement gave a glimpse into the setup process and what the shops will look like.


Facebook has outlined some features which are already available and some which are coming, but not quite ready for their early launch.


Just like an eCommerce store would have a popup chat, your Facebook Shop will have a message button allowing customers to contact you through WhatsApp, Messenger or Instagram Direct. They foresee customers getting their tracking updates via these platforms as well.

In App Purchasing

Facebook has stated, “in the future, you’ll be able to view a business’ shop and make purchases right within a chat in WhatsApp, Messenger or Instagram Direct.”

This may solve the problem of needing a website to link to for smaller businesses. 

If you think you spend a lot of time on social media already, Facebook are working to increase this time even more! 

Live Shopping

Live shopping is a feature due to be added which will allow brands and influencers to tag a product from their Shop before going live on Facebook or Instagram. This will then show a link at the bottom of their video so viewers can click to learn more or purchase. This will be fantastic for product showcases, unboxing videos and reviews. This feature is being tested now and will be rolled out more broadly in the coming months.


Facebook has invested a lot of time and money into AI and augmented reality technology. In the future they plan to integrate this with their shopping platform to create “better shopping experiences” Mark says “We’ll automatically identify and tag products in feeds so people can easily click-through to purchase when they find things they like. Small businesses will also be able to personalize their storefronts to first show products that are most relevant to you and use augmented reality to let you virtually try on things like sunglasses, lipstick or makeup to see how they might look on you before buying, or what furniture might look like in your room.”

Welcome to the new world of online shopping!

Loyalty Programs

Facebook are also testing the ability to integrate your rewards programs within your Facebook shop. They are also “exploring ways to help small businesses create, manage and surface a loyalty program on Facebook Shops.” 

Instagram Shop

Starting in the US (why never Aus?!) they will be introducing Instagram Shop. Imagine scrolling through your pretty Instagram feed, but in this tab everything is for sale!

I spent a lot of time on Instagram tracking down the items in the photos I like and figuring out where to buy them, so this sounds like an exciting addition to me. 

You will be able to browse based on your favourite accounts or filter by category. When released there will be a new Shop tab in the top of the Instagram navigation bar so you can browse and shop all from the one app.

How do you get one?

Although Facebook Shops are destined to be available for all businesses, today they have started to be rolled out to eligible businesses who already use Instagram Profile Shops and/or Facebook Page Shops. They will be rolling out globally in stages for both Facebook and Instagram shops over the coming months.

If you currently use Instagram Shopping or a Facebook Page Shop, keep an eye on your email and in-app messaging as that’s where they will contact you when your shop is ready to start setting up.
If you don’t currently use these products, sign up for them today to ensure you’ll get access to Shops as soon as your business is eligible. 


Final Thoughts

I think this is building to be an exciting addition to the Facebook platform. I don’t think it will ever remove the need for a website of your own where you have full control but will be a nice complementary medium for people to discover your products and a great way to start out for small businesses, once Facebook fix the in app transactions. 

Given data breaches in the past and ongoing privacy concerns, I think there may be some hesitation for users to check out within Facebook and trust the platform with their secure payment information. On the other hand, businesses that have seen their ad accounts shut down because a robot deemed their account violated their T&Cs might be skeptical to invest too much energy into hosting a shop on the same platform that could close it in an instant. 

However, if they can get it right, with their inclusions of the latest in AI and augmented reality and the sheer amount of time people already spend on their platforms, this could revolutionize the way people shop.  

Written by Karyn Parkinson

Karyn AKA Karyn with a Y is a Facebook ad specialist with a side dose of eCommerce marketing, particularly website optimisation.

When she's not behind the computer you'll find her at the beach with her fur babies or on the roller derby track as Pink Fury!

Assistance Available For Your Small Business Right Now

Assistance Available For Your Small Business Right Now

The events of the past few months have had a huge impact on businesses around the world. If your business income has been affected there are some new initiatives which may assist.

Below is some of the assistance available. These are links to external websites we do not control. Please ensure you do your own research and talk to your accountant about your eligibility.

Government Assistance


The Australian government has announced $189 billion worth of economic responses to help keep the economy going.

Many of these are available to help small business and include payments for businesses who have employees, assistance for apprentice and trainee employer and increased instant asset write-off limits.

Find out more at


If you have a debt with the tax office or are unable to meet your upcoming obligations with the tax office due to the effect Covid-19 has had on your business, you can request for payments to be deferred to September 14. Simply ring the tax office to discuss your individual circumstances. 

The wait is longer than usual, however, the automatic message said my wait would be over 30 minutes and I was talking to someone in around 10-15 minutes. 


The government has also increased assistance to Australians including income support payments, payments to support households and temporary early releases of superannuation.

Find out more at


Facebook has announced $100 million in cash grants and ad credits to 30,000 eligible small businesses. At the moment all you can do is subscribe for updates and more details will be released later. 

Make sure you subscribe at


Shopify has come to the party with a few assistance measures.

This includes the ability to sell gift cards on any Shopify plans, usually restricted to higher plans only. So if you are unable to trade right now, but want the ability for people to be able to buy gift cards to use in the future, you can now turn this on if you are using Shopify.

For those who are only now moving to online Shopify are offering extended 90-day free trials.

They are also offering $200 million in small business funding by way of loans, however, these are currently restricted to US only.

Find out more about how Shopify are helping at

What Else Can You Do

  • Ensure to read our Thrive Guide on how you can put your best foot forward and thrive through uncertainty
  • Review your spending 
    • Cancel any unnecessary subscriptions
    • Reduce your Shopify plan if you need to 
    • Hold off on big purchases
  • Look after yourself first – your mental health is most important right now
  • Surround yourself with a positive community
How to prepare your eCommerce business for February 2020

How to prepare your eCommerce business for February 2020

Let’s take a look at how to prepare your eCommerce business for February.

Preparing for February seems crazy, I’m still coming to terms with the fact we’re in January already!

As we start to get over the festive season hangover and move towards making our goals for 2020, January is coming to an end and it’s time to prepare for February.

As a small business owner, sharing content is the perfect opportunity to contribute to conversations, express your brand values and inject personality into your narrative.

If you’ve followed Megan and I for a while you would know we don’t often sit on the fence about things. We attend climate rallies and post about it online, if people don’t like that they are not our people. 

Don’t not post what you believe for fear of offending people – if you do, they are not your ideal audience. My only exception to this rule is religion – this is a very personal thing and unless your business is based around a religion this is something I would keep off your business social media. 

With that in mind let’s take a look at what’s on in February 2020 and how you can incorporate these special days into your content calendar.


What’s on in February 2020:

02 Super Bowl Sunday

Superbowl Sunday is a huge sporting event in America, although this is not an Australian event it is known worldwide, not only for the sporting competition but also the half time ads. Large companies spend millions creating special ads and playing them during half time both at the ground and during TV streaming.

The Super Bowl ads are probably the most prestigious ads each year as each company aims to outdo the next.

This may not be relevant to you but do yourself a favour and watch the ads for a good laugh and some ad ideas.

Suggested posts: 

  • Ask your audience what their favourite super bowl ad was
  • Tell your audience what your dream Superbowl ad would be for your business
  • Ask your audience what they think your Superbowl ad would look like
  • If your audience is in America you could run posts around what they are doing on Superbowl Sunday, if they are watching the game etc.
  • We don’t spend money on big flashy super bowl ads, what we do is…. <your amazing business features here>

04 World Cancer Day

There are many cancer awareness months and days throughout the year, however, World Cancer Day is an international day to raise awareness of all cancer and to encourage its prevention, detection, and treatment. 

If you have a personal connection to cancer or your business is in some way involved with a cancer product or supporting a cancer charity today would be a good day to acknowledge it.

05 World Nutella Day

If your business involves food products consider making something with Nutella to tie into World Nutella Day. 

Or alternatively if you’re business is against Nutella due to it’s palm oil use then this is a chance to mention it. 

If you just want to encourage some engagement you could run a poll on your page to see if your audience is for or against Nutella.

You don’t have to post about something if it doesn’t sit right with you and your business values. Use the opportunity to be authentically you and share your thoughts and opinions – in line with your business.

14 Valentine’s Day

Oh Valentine’s Day, the day of love. The day we wish we had a partner for when we are single, and forget all about when we’re married! 

Valentine’s Day is a great opportunity if you sell potential gifts.

Suggested Posts:

  • Promote last-minute gift ideas
  • Showcase products you Love
  • Show love for your community
  • Encourage people to spoil themselves this Valentines Day and provide a special offer with code LOVE (or you can be less corny if you want!)

Alternatively if you don’t like Valentine’s Day – talk about that! A great opportunity to share some personal insights. 

15 Singles Awareness Day

Yes, this is a real thing! For all the singles that hated Valentine’s Day, the next day is theirs. 

Celebrate all the singles in your community this day.

Consider gifting them all a special offer.

You could put a fun twist by promoting all your products for one, if relevant to your business! 

20 National Love Your Pet Day

My dogs are my children and I know I’m not the only crazy dog lady out there! If you have pet products this is a great opportunity for you to encourage (read guilt) owners into buying them a gift.

If you don’t have pet-related products you can still use this day to encourage great engagement on your posts and increase your organic reach.

Suggested Posts:

  • Today is National Love Your Pet day, how will you spoil your pet today?
  • Encourage your community to share a photo of their pet (there is nothing we enjoy more than sharing photos of our fur babies)

23 Oscar Night

Oscars is a great opportunity for fashion businesses to incorporate posts into the big day.

You could start this a week out and do a whole range of posts in the lead up to the Oscars.

Suggested Posts:

  • Suggested Oscars outfits
  • Oscar worthy outfits
  • Our favourite outfits from the Oscars
  • Oscars hit and miss – share your opinion and position yourself as a fashion expert or just have a little fun with it
  • Ask your audience their favourite outfits from the Oscars
  • Ask your audience what they would wear to the Oscars
  • Ask your audience who would be by their side as their date to the Oscars, if they could pick anyone and which <your brand> outfit they would be wearing

29 Sydney Mardi Gras Parade

Post your rainbows far and wide and show your support for the LGTBIQ community during the biggest Mardi Gras in Australia. 

Please note this is a day of celebration for the community so if you’re not in support, this is not the day to post. 

Well there you have it some of the top days in February to incorporate into your 2020 content calendar. If I’ve missed a day you think should be there let me know in the comments below. 

Want to plan ahead for your 2020 content calendar? Download our full 12 month 2020 eCommerce planner below.

Written by Karyn Parkinson

Karyn AKA Karyn with a Y is a Facebook ad specialist with a side dose of eCommerce marketing, particularly website optimisation.

When she's not behind the computer you'll find her at the beach with her fur babies or on the roller derby track as Pink Fury!

Business In A Crisis: How To Help

Business In A Crisis: How To Help

As I write this Australia is on fire. People are losing their homes, sadly some have lost their lives and our wildlife is being burnt alive, some species perhaps to extinction. It’s a disaster zone and people are scared, angry and devastated. 

5.9 million hectares have been burned across Australia and Ecologists at Sydney University have estimated over 800 million animals have been affected in Australia since September, and it’s only the start of January. 

I have a close friend who is a volunteer firefighter in Tasmania and will be deployed to assist with the fires later this week. I’m scared for him and his family.

I live in Tasmania which has seen its fair share of devastation by fires, but currently is not experiencing anything as bad as the mainland states. There is no escaping it though, every time I look at my Facebook Newsfeed or turn on the TV there it is. It’s confronting and leaves me sad, scared for my country and wanting to help.

That’s the silver lining with tragedies, you get to see the true human spirit come out as people rally together to help. I’ve watched videos of everyday Australians running into burning areas to rescue Koalas or stopping to give animals drinks on the side of the road. Wildlife rescue centres are doing amazing work rehabilitating our affected animals and people all over Australia, and the world and pulling together to help. They are making swaddles and pouches and collecting supplies to send where they are needed. 

The most amazing thing is how quickly people have opened their wallets and donated. Australian comedian Celeste Barber has shocked everyone, including herself, with the success of her Facebook fundraising campaign. Celeste’s mother in law is directly affected by the fires, so she set up a Fundraising post via Facebook with a target of $30,000 “Want to join me in supporting a good cause? I’m raising money for The Trustee for NSW Rural Fire Service & Brigades Donations Fund and your contribution will make an impact, whether you donate a lot or a little. Anything helps. Thank you for your support.”

At the time of writing this, a mere 3 days after the fundraiser started, it is sitting at $32,361,031 and rising. The fundraiser has been collecting $1,000 a second via Facebook! 

This is what makes Facebook truly amazing. Think about how different things would have been without social media. Fire affected communities would have to rely on News Updates via TV and radio. The rest of the world may have seen the fires on the news but that would have been it. 

Social media is a real-time glimpse into what people are experiencing and the message reaches far and wide, very quickly.  People all over the world have contributed to fundraisers and rallied together to help Australians affected by the fires. I wonder if this would have happened without the constant reminder in their News Feeds?

Facebook has allowed people to stay in touch with friends and family and keep updated on how they are. People in disaster zones can mark themselves as safe so people can quickly be reassured they are OK.

One thing that has come up for some people running their own business, is how do they go about business as usual when people are suffering, and if they want to help, how should they go about it? 

Now the following is just my opinion on how to best use your business to help and at the end of the day you need to do what feels right for you. You can read this post on how to carry on business in a crisis.

I feel that if you are wanting to help with the bushfire appeal, or any disaster fundraising efforts, there are some rules to follow to make it a genuine, helpful donation and not a profiteering sales pitch. 

Are your intentions genuine?

This one is easy to cheat but I want you to ask yourself, am I offering this to get more sales? If the answer is yes then don’t do it. In times of tragedy, we don’t need people using the disaster to generate sales.

Know where your money is going, and make it clear

If you do decide to help then pick a legitimate charity or cause to donate to, do your own research and ensure the money is going where it is needed without a large percentage removed for admin costs. Ensure the charity aligns with your own values.

When promoting your offer ensure you clearly state where the money is going, when and how it will be donated.

Being vague like money will be donated to a bushfire appeal, or people affected by the bushfires, can look spammy and leave people wondering if the money will be genuinely donated or not. 

Keep proof of donation / be transparent

Make sure you keep all proof of your donation so you can show transparency. If people lose trust with you, there is no coming back from that. 

Donate then tell

If you want to make a genuine donation to the bushfire appeal and your motives aren’t to get more sales, then make the donation first. You can then tell your community that you donated $X to the XYZ organisation because you believe in the work they are doing. You can then encourage your community to donate also and provide the relevant link. Again, consider your intentions here. If you are doing this for the PR, then don’t. But if you are doing it to raise awareness for the cause and encourage others to donate, then that’s fine. 

Donate all or nothing

Profiteering at a time like this really bothers me. I believe if you genuinely want to use your product to generate sales so you can donate more, and people get something for their donation then a 100% of profit model is the way to go. If you can afford it 100% of revenue is even better. 

Now I understand people still need to make a profit during times of tragedy and can’t afford to just give up all their earnings so ways you can do this are either do it on just one product or just for a set period.

One of our students Kim from Burbridge and Burke has done this beautifully. They created a special product, Koala studs and are donating 100% of profit to NSW RFS. So far they have raised over $3,000 in just 48 hours!

My personal belief is donating a small portion of sales looks salesy and you are still making money off the disaster which to me feels yucky. There is nothing wrong with continuing business as usual though, making sales, making money and then using that to donate a lump sum to your charity of choice. You can then use the donate then tell model. 

Other Ways You Can Help


Set up a Facebook fundraiser post

This is what Celeste did and as you can see it can go a long way. Setting up a fundraiser post is easy, and the not-for-profit organisation is already registered through Paypal so the money automatically goes to them, so you don’t need to do a thing.

There is a fine line here. If a fundraiser exists for the charity of your choice, share and donate via the existing fundraiser. Again, it comes down to intentions. If it looks like you are doing it to raise awareness for your brand, it can feel yukky. 

To set up the fundraiser simply create your Facebook post

The organisation must be registered with PayPal giving to appear.

I suggest including a story as to why you want to support this particular organisation and encourage people to help.

Collect Donations

Add a donate call to action to your checkout. You can say your business is supporting the XYZ charity and you would love if they could help. Then allow them to provide a donation as an add on to their purchase. Ensure 100% of that donation goes where you said it would.

Donate goods

If you have supplies that may help a charity, or people affected by the bushfires consider donating goods rather than money. Please be careful with this one as many relief centres simply can’t process any more items. Do your research and find your local food bank or animal rescue centre and donate things that they actually need. 

Educate your audience

If you’re not in a position to donate, educate your audience who may be. Find your favourite charities who are doing good things for those affected by the fires and tell them why you like them. Share stories and posts from charities and organisations. Spreading the word via social media is the reason why so much money has been raised so show your support in this way if you can’t financially.  

Support businesses affected by the fires

While many of us are trying to do our bit to help, others are directly affected by the fires which makes it very hard to continue running their business. Look for businesses affected and support them. Purchase their items, with no expectation to receive them any time soon, if at all. Keep their income going as they may rely on this to support their family during this difficult time. 

Fires are not the only crisis going on right now either, many towns are affected by drought. The #BuyFromTheBush initiative lists businesses in these affected areas, many of which are also affected by the fires. You can find businesses to support at

Once the fires are over, visit the affected area. Buy their petrol, stay at their hotels, eat at their restaurants and cafes and go crazy at their shops. One of the worst things that can happen to affected towns is that their economy dies in the aftermath. 

Where you can donate

If you are looking for an organisation to support here are some I like:

NSW Rural Fire Service

Donations to the NSW Rural Fire Service directly benefit the volunteer firefighters on the frontline.

Victorian Bushfire Appeal

The Victorian Government has partnered with Bendigo Bank and The Salvation Army to establish the Victorian Bushfire Appeal. 100% of donated funds will go directly to communities in need.


WIRES Is Australia’s largest Wildlife Rescue Organisation. In December alone there were over 20,000 calls to WIRES 1300 line, a 14% increase on last year, and volunteers attended over 3,300 rescues.

Koalas In Care INC

This is a non-profit organisation and a registered charity run by volunteers. They have been helping rehabilitate Koalas affected by the fires.

To everyone affected by the fires, my thoughts are with you, please stay safe.

To our firefighters and their families, we can not thank you enough.

Suggested Reading: Business In A Crisis: Business As Usual?

Replay of the live chat we had about this topic in our Facebook Group.

Written by Karyn Parkinson

Karyn AKA Karyn with a Y is a Facebook ad specialist with a side dose of eCommerce marketing, particularly website optimisation.

When she's not behind the computer you'll find her at the beach with her fur babies or on the roller derby track as Pink Fury!