{"id":4419,"date":"2023-05-26T09:41:33","date_gmt":"2023-05-26T07:41:33","guid":{"rendered":"https:\/\/www.ban.co.za\/ban-clients\/?page_id=4419"},"modified":"2025-11-19T14:47:11","modified_gmt":"2025-11-19T12:47:11","slug":"service-product-costings","status":"publish","type":"page","link":"https:\/\/www.ban.co.za\/ban-clients\/service-product-costings\/","title":{"rendered":"VAS: Service and Product Costings"},"content":{"rendered":"
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SERVICE AND PRODUCT COSTINGS<\/span><\/h4>\n

Just because you are making sales does not mean that you are making a profit. When last did you review your pricing? Do you know what your monthly and annual breakeven sales figure is?<\/p>\n

Services and product costing<\/em>\u00a0is the process of determining the total expenses involved in the creation of a\u00a0product<\/em> or the delivery of a service including all direct and indirect costs. \u00a0Many smaller business owners make the mistake of not factoring in profit, annual overheads, replacement of assets and a market related salary for themselves in their service costings or product costings.<\/p>\n

When last did you review your pricing strategy?\u00a0 There are three basic methods of pricing your products and services that depends entirely on the type industry that you are in: cost-plus, customer based and competition-based pricing.<\/p>\n

The optimization of pricing strategy is as important as the management of costs and the growth of sales volume.\u00a0It\u2019s not uncommon for smaller business owners to skim over pricing. They often look at the cost of their products, consider their competitor\u2019s rates, and tweak their own\u00a0selling price<\/a>\u00a0by a few rands. While your cost of sales and competitors are important, they shouldn\u2019t be at the centre of your pricing strategy. Pricing strategy should take into consideration the value you provide \u2013 what makes you better, more special and different where you can take a strategic advantage and competitive edge over other players in your market?<\/p>\n

The best pricing strategy maximizes your profit\u00a0and<\/em>\u00a0revenue.<\/p>\n

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