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Finding A Competitive Pricing Strategy For Maximum Profits

Establishing a healthy pricing strategy can boost your bottom line.

This story appears in the February 1996 issue of Business Start-Ups magazine.

Deciding what to charge your customers is one of your most important--and difficult--decisions as a new owner. Set your prices correctly, and you'll not only make a profit, you'll bring new customers in the door. Choose the wrong price and your business may be doomed from the start.

How do you decide what price is best? Unfortunately, there are few easy answers to that question. Each company must find a balance between financial concerns (such as costs and ) and factors (such as consumer demand and market conditions). Small-business experts agree, however, that there are some common mistakes you should avoid when you're setting your price:

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