How to price your products — so you actually keep the profit
Most small sellers price by gut, then wonder where the money went. Pricing is a system: cost, margin, shipping, fees and a little psychology. Get it right once and every order works for you.
The short version: price = cost of goods + margin, then account for shipping, COD and fees, then sense-check against the market. The fee you don't see — marketplace commission — quietly shrinks margin as you grow. A SitesPlaced store charges 0% commission and a flat ₹499/month, so the maths stays in your favour.
Start from cost, not from competitors
Copying a competitor's price is the most common mistake. Their costs, volumes and fees are different from yours, so their price tells you nothing about whether you'll make money. Pricing starts from the bottom up — what each unit truly costs you — and works upward to a number that leaves real profit.
Use the market as a reality check at the end, not as your starting point. If your cost-based price is wildly higher than the market, the fix is usually lower costs or higher perceived value — not just slashing the price and losing money on every sale.
The five things every price has to cover
Cost of goods (COGS)
Everything it takes to make or buy one unit — materials, manufacturing, packaging and the labour that goes into it. This is your floor: sell below it and every order loses money. Track it honestly, including the small costs people forget like tags, boxes and tape.
Your margin
The gap between price and cost that becomes profit. A common starting point is to mark up at least 2–3× your COGS, but the right number depends on your category, perceived value and competition. Premium and handmade goods can carry a higher margin because the story justifies the price.
Shipping & COD costs
Delivery isn't free, and Cash on Delivery adds handling and the risk of returns. Decide whether to absorb shipping, charge it, or set a free-shipping threshold. With Shiprocket built into your store, labels, tracking and COD reconciliation are handled, so your real shipping cost is predictable.
Platform & payment fees
This is the silent margin killer. Marketplace commissions and payment-link cuts take a slice of every sale — and percentage fees grow exactly as your sales grow. A SitesPlaced store charges 0% commission and a flat ₹499/month, so the platform never scales its cut with your success.
Psychological pricing
Price is a signal. Charm pricing (₹499 instead of ₹500), bundles, and a clearly 'anchor' higher-priced option all shape what feels like a good deal. Round, confident pricing can signal premium; ending in 9 can signal value. Match the cue to your brand.
A simple profit example
| Line item | On a marketplace taking a commission | On a 0%-commission store (₹499/mo flat) |
|---|---|---|
| Selling price | ₹1,000 | ₹1,000 |
| Cost of goods | – ₹400 | – ₹400 |
| Shipping (your cost) | – ₹80 | – ₹80 |
| Platform commission | – a percentage of every sale | ₹0 (0% commission) |
| What's left as profit | Less — and it shrinks further as you sell more | More — the flat fee doesn't grow with sales |
Figures are illustrative to show the mechanism — your own numbers will vary.
The fee that decides your pricing freedom
A percentage commission is the one cost that punishes growth: the more you sell, the more it takes. That forces you to price higher just to stand still. A flat platform fee flips this — your per-order economics improve as volume rises, because the cost is fixed.
That's why where you sell is a pricing decision, not just a tooling one. With 0% commission and a flat ₹499/month on a SitesPlaced store, you can price competitively, run a sale, or simply keep more profit — without a platform skimming each transaction.
Frequently asked questions
How do I price my products for online selling?
Start with your cost of goods, add a margin (often 2–3× to begin with), then account for shipping, Cash on Delivery handling and platform or payment fees. Finally, sense-check against what buyers in your category will pay and apply psychological pricing. The key is to price for profit after every cost, not just above your raw material cost.
How do marketplace commissions affect my pricing?
Percentage commissions eat into every sale and grow as you grow, so you often have to raise prices just to keep the same margin. A flat-fee store changes the maths: with SitesPlaced you pay ₹499/month and 0% commission, so the platform doesn't take a cut — meaning you can price more competitively or keep more profit.
What margin should I aim for?
There's no single number, but many small sellers start at a 2–3× markup over cost of goods and adjust from there. Handmade, premium and story-led products can carry higher margins; high-volume accessories usually run lower. Always make sure the price still leaves profit after shipping, COD and fees — that's the margin that actually matters.
Should I include shipping in the price or charge separately?
Both work — many sellers fold shipping into the price and advertise 'free shipping', or set a free-shipping threshold to lift average order value. The important part is knowing your true delivery and COD cost first. With Shiprocket integrated into your SitesPlaced store, that cost is predictable, so you can price shipping with confidence.
How does a SitesPlaced store help protect my margins?
It's free to build and ₹499/month ($14.99) to publish, with 0% commission — so unlike percentage-based marketplaces, the platform never takes a slice of your revenue. Built-in UPI/COD/Razorpay, WhatsApp checkout, Shiprocket and GST invoices mean fewer separate fees and lost orders, which keeps more of every sale as profit.
Price for profit — on a store that keeps your margin
Sell on your own store with 0% commission, so the platform never eats your margin. Free to build; ₹499/month flat to publish, with payments and shipping built in.