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ecommerce pricing strategies

Posted on 2010-09-05
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Last Modified: 2013-12-14
We're pretty new to the ecommerce market and I believe that there are customs and payment structures which differ to standard corporate site builds. Am I right in thinking that you charge an intial  build and production charge 10K+ for example and then add a monthly maintenance fee or claim a small percentage of each online sale? If you do have the maintenance charge what is the usual amounts and what is the best way to explain this to clients? If you take a percentage of the transaction what type of percentages are seen as sensible?

thnx in advance
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Question by:sousflai
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by:khaledf
khaledf earned 166 total points
ID: 33606906
it all depends on your expenses on each transaction and other factors

brainstorming and research is required depending on your business model in order to list all expenses and then you can specify a target of sales to be reached period-wise.

I have seen many strategies in this regard.
some will charge $1 + %5 of each sale.

you should get the lowest fee payment gateway in order to increase your revenue.
after you get more experience you can negotiate with your payment gateway for lower fees once you get high volume of transactions generated from your site.

hope this helps
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Kurt4949 earned 167 total points
ID: 33608324
I would avoid charging a % per each sale.  There are plenty of shopping cart solutions that don't charge that fee.  Once your customers realize that they'll probably look else where.  Online sales are very competitive and every penny counts.  Instead I would look at charging an up front fee to get them up and running then you could also charge a hosting and maintenance fee depending on how much on going work the customer expects from you.  
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by:yohanesbule
yohanesbule earned 167 total points
ID: 33608402
I believe that nowadays such huge expense would become useless. Huge corporate would prefer to hire their own programmer to do just that.

I think its better for your to give 50% discount for design, programming and other related... Only then you are eligible to ask for small percentage of the sale for the rest of the company life... :)

If you are developing payment system gateway and maybe payment processing such as paypal and moneybookers, then yes, you are able to charge for fees right from the start.

Hope this helps.
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