- Business Ideas

Choosing the Right Keystone Pricing Strategy for All Your Retail Goods

Most retailers have one common challenge, which is basically determining the right and most profitable price for all their retail products. Some inevitable factors such as the nature of retail products and existing competition make retail pricing quite cumbersome, especially for new retailers. Nevertheless, keystone pricing, which means pricing products double the buying price or wholesale price, has made retail pricing less cumbersome. But the pricing model may have some downsides as well. After all, keystone pricing like other pricing models should be done using the right pricing strategy for the retailer to benefit from the pricing model. In other words, the keystone pricing strategy used can simplify or complicate retail pricing. Here are tips for selecting the right keystone pricing strategy for your retail products.

Consider the Nature of Your Products

Not all retail products can be sold profitably via keystone pricing. Retailers selling common products that are easy to get in various places risk losing clients if they price their merchandise using the keystone pricing model. Depending on the nature of the retail products you intend to sell or you are already selling, determine whether using the keystone pricing concept will either earn you higher profits or scare away prospective clients. If your retail products aren’t common, ensure the keystone pricing strategy is used effectively for maximum profits. But if your retail products are common or easy to find, utilize a pricing strategy that won’t translate into a higher selling price lest you scare away potential buyers, especially if your competitors are selling similar products way cheaper.

Be Realistic

Keystone markup, which simply means the ability to sell a product twice the price it was bought or produced, has been the most attractive bit of keystone pricing. That means retailers can profit from this pricing model in the long-run. However, this can make products costly for buyers discouraging them from purchasing from you particularly if buyers already know of different sellers selling similar products to yours at a cheaper price. Even when using keystone pricing model, be realistic and see to it that your products aren’t costly compared to those being offered by your competition. After doing your keystone pricing, make sure the buying price is still affordable for your clients. Similarly, ensure the final price is profitable for your retail business.

Compare Your Selling Price with that of Your Competitors

Even after lowering the keystone price for your retail goods, the price could still be way high in comparison to the price of products been sold by your competitors. Compare the price of your products with that of your competitors after pricing. Lower the price if your competitors are selling at a higher price but ensure the selling price is still profitable for your business. To learn how your competitors have priced their merchandise, simply check their sites and analyze their selling price. Now come up with a final price for your goods, which will cushion you from losing potential clients to your competitors but still guaranteeing you reasonable profits.


Keystone pricing can assure you maximum possible profits for your retail goods. But this is only if the pricing model is used effectively. Choose a keystone pricing strategy that suits your retail pricing needs.

Leave a Reply

Your email address will not be published. Required fields are marked *