Its crucial that businesses in the UK jewellery market have a considered pricing strategy to attract customers and sales. A good strategy will balance item pricing and quality, and this guide will serve to highlight a number of key factors to be considered when building out your sterling silver jewellery pricing strategy.
Customers in the UK, wholesale and retail, value quality, style and sustainability when selecting jewellery items. Over the past decade, consumer shopping habits have shifted towards more of an interest in high-quality and ethical pieces. When considering the effect of global warming on sustainability, and how the fast fashion market impacts this, customers are keen to buy less and buy quality.
By partnering with a factory direct silver jewellery supplier for the UK market, this gives the seller far better control of the product quality/sustainability measures taken to ensure that we’re meeting customer expectations. Following this measure can also support keeping costs low and therefore allow you to have greater freedom in pricing your products, increasing profitability.
What considerations do I need to take when creating a pricing strategy?
Cost of Goods Sold (COGS)
The first thing you MUST do, is breakdown the full cost of the items you’re selling. This includes material, manufacturing and shipping costs. Working in a factory direct relationship, this process is eased with their support. A very important factor to stay on top of when considering COGS is to keep an eye on silver prices! Silver price will greatly determine how you price your stock.
Market Demand
Different season and trends can effect market demand. To ensure that you’re able to fluidly adapt to rapidly shifting trends, its vital to have a solid understanding of sterling silver jewellery wholesale best sellers in the UK. Knowing which products are selling well, and being able to anticipate upcoming market demands will allow you to increase/lower item pricing in line with market trends.
Market Competition
One of the key factors a customer looks for an in item is of course price. A great way to get a baseline idea of how you should price your items, is to review your competitors and see how they’re pricing their pieces. By reviewing their pricing strategies, this will allow you to remain competitive in the market.
Target Market
Dependent on the item you produce and then retail/wholesale will allow you to establish a target market. Its so important to know your target market, because different markets each have different priorities/resources. For instance, if you produce items in line with rapid market trends and a younger feel, you may find that your target market is teens. As a retailer, its important to consider that the teen market will not have as much disposable income as other market groups. This should factor into your pricing strategy.
Example Of Pricing Strategies
Keystone Pricing
Keystone pricing is a strategy whereby you double the wholesale/COGS cost. This is a very common retail strategy, and one that is exceptionality easy to calculate. For example, if an item cost £2 to buy, keystone pricing dictates you sell it for £4.
Dynamic Pricing
A dynamic pricing strategy plays well into the market demand information noted in this guide. This strategy basically increases item prices in line with market demand. An example of this is increasing the price of heart-shaped items in the run up to Valentines Day.
Psychological Pricing
We’re all wired to want a bargain! It has been proven that we’re more likely to buy an item ending .99, than we are rounded up to the next pound. This strategy feels basic, but can have a great psychological impact on customer shopping habits.
Hopefully the information in this guide provides you with a starting point on the considerations to take when pricing your sterling silver jewellery. By taking onboard some of the tips shared, you should be setting yourself up for a good rate of profitability in the UK jewellery market.
