Pricing Strategies for Retailers

[SwordfishMining]

This is from Virtual Diamond Boutique but I think it applies to most things.
Pricing Strategies for Retailers: An Overview of Pricing Concepts and How to Choose the Right One

https://welcome.vdbapp.com/index.php/re ... -right-one

The last paragraph is: Should I Sell Below Cost?

Loss leaders might help you get your foot in the door or get new customers through the door, but selling at below cost, or below a level that is profitable, is not sustainable or even all that effective in the luxury or fine jewelry sector. If you are attracting customers whose main concern is price, these customers will not return once prices return to normal levels. And if you set prices too low, you may no longer be perceived as a luxury brand by consumers.

Furthermore, these types of strategies rely on large sales volumes—and in some cases, creative merchandising—to drive revenue. For example, grocery stores often sell milk at a loss, but the milk cooler is also located at the back of the store, forcing the customer to run an impulse-buy gauntlet of products they’ll unthinkingly toss into their basket while making their way toward the milk.

The bottom line is that fine jewelry retailers are selling luxury goods at luxury prices. This doesn’t mean you can charge whatever you want, but it also doesn’t mean you should sell yourself short or try to compete on price. You need some other strategy to justify your prices and attract customers. If premium pricing is your goal, cultivate your image as an exclusive and unique brand and sell products that back up that image. If value-added pricing is your goal, your marketing materials—and your customer reviews—should make consumers aware of everything they’re getting in addition to a high-quality product.

Link at the top to the rest