Knowing cost helps set price.(Profit In A Page)

This month I begin a series on how cost relates to price. I believe the market sets the price. But as a converter you are part of the market. If you are the incumbent supplier, then the price you charge is, by definition, the market price--good or bad.

Some managers employ what I call an "internal pricing strategy." That's like standing outside the building and looking in. They ask themselves (or their accountant) how much it will cost to make the product and how much profit they want to make. That becomes the price.

Others employ an "external pricing strate