is there an actual formula companies use to calculate what the perfect price of an object should be?
In: Economics
Yes! There is a formula.
Find a low price that you are satisfied with without adding your money to the object you are selling. 2-4%. Then check if there is a traffic for this object. If there is double it! Check how number of clients changes. If it justifies bigger prices? Then double it again, and again and again. Until you feel that you overstreched your market. Then make permanent discount. Wait year or so and double it and repeat the whole process again.
Welcome to capitalism
Combination of market research and trial and error. Sometimes augmented by testing in a limited market to gauge reaction by purchasers.
There’s no formula, but you generally know what the thing cost you, and you can look at competitors’ prices, and set your prices in that range.
Over time, you’ll find that you’re selling more or less than you’d like, and adjust your prices up or down accordingly. (Always being careful that you’re making enough to pay your overhead and leaving some profit. If not, you’re in the wrong business.)
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