A 5-Step Guide to Setting the Perfect Launch Price on Amazon FBA

Are you ready to launch your product on Amazon FBA? Congratulations! You’re taking the first crucial step towards achieving success in the world of online retail. But before you can begin selling on Amazon FBA, you must set the right price for your product.
Pricing has a huge impact on your product’s performance on Amazon, so it’s important to do your research and calculate the perfect launch price that will get you maximum sales and profits. If you’ve already done some digging and are still unsure of how to set the perfect launch price, fear not! In this article, I will show you the five steps required to set a successful launch price on Amazon FBA.

Step 1: Research Competition

Before you set your launch price, you’ll want to research the competition. That means taking a look at what others in your niche, who have similar items, are charging. As competition increases, prices are typically driven down as buyers tend to try and choose the most affordable option.
You can also use Amazon tools like Keepa, RepricerExpress or CamelCamelCamel to keep an eye on competitors or keywords in order to get an idea of how much the demand for your product is undercutting yours. You might also identify competitors whose prices are lower than yours and investigate their strategies, like whether they’re offering discounts or offering special promotions on holidays. This will help you decide whether it is worthwhile changing your pricing strategy.

Step 2: Evaluate Products Features & Quality

The cost of your product should directly relate to its features and quality. When pricing for an Amazon launch, it’s important to understand what you’re offering compared to similar products on the market. A few key questions you can ask yourself to evaluate the product in this way include:
  • What is the quality of my product?
  • How efficient is the production process?
  • Is there a competitive advantage in terms of features offered or delivery speed?
  • Does the product offer any unique features that justify a higher price point?
All of these points should be taken into consideration when setting pricing for an Amazon launch. You want to make sure you’re offering your customers value and an overall good customer experience that will keep them coming back in the future. Evaluating these points will help you determine what price point you feel comfortable launching at without undercutting or overcharging.

Step 3: Set Pricing Target & Margin Goals

Let’s get into step 3 of setting the perfect launch price on Amazon FBA. This step is all about determining the pricing target and margin goals that are the best fit for your product.
It’s important to set your pricing target and margin goals ahead of time, because they will act as a guide for you when choosing the right launch price. This includes:
  • Calculating your cost of goods sold (COGS)
  • Deciding the appropriate markup for your product to ensure profitability by taking into account the correct price points that align with costs, Amazon fees, and desired profit margins.
  • Estimating how much additional cost (for advertising, shipping, etc.) should be factored into your launch price
  • Identifying any potential suppliers or sellers offering similar items at different prices
Take some time to consider all these points before selecting a launch price for your product, so that you can achieve the desired margin while still making it enticing enough for customers to buy. Setting clear pricing target and margin goals will help you land on a successful launch price that works in your favor!

Step 4: Analyze Delivery & Fulfillment Costs

Next, it’s time to analyze the delivery and fulfillment costs. As we know, you can’t simply price your product at whatever you want—you need to factor in the delivery and fulfillment costs associated with selling on Amazon FBA. This means tracking every single cost that goes into shipping your product.
If you’re selling something small, like a beauty product or a tech gadget, the cost of shipping may be minimal or even free through Amazon Prime. However, if you’re selling something larger and heavier—like furniture or home appliances—you’ll want to make sure you factor this into your pricing to avoid losing money on each sale.
An important part of analyzing these costs is determining whether to opt for Amazon’s warehousing services or use a third-party company such as Shipwire or align with an overseas manufacturer/seller. All of these options have different associated costs and should be taken into consideration when finalizing your launch price for Amazon FBA.

Step 5: Launch & Monitor Your Price

The fifth and final step in setting the perfect launch price on Amazon FBA is launching your product and monitoring your price. This step is important to ensure that your product is selling at the right price point and that you are optimizing your profits
You should monitor the competition’s prices during the launch to ensure you stay competitive and adjust your own prices accordingly. You can use Amazon’s Price Dashboard, Price Tracker, or Seller Central to track and analyze competitor prices.
Another important factor in pricing is understanding the changing dynamics of customer demand. You can monitor demand by tracking sales velocity, reviews, competitor prices, discounts, and promotions. By understanding changes in customer demand, you can adjust your pricing strategy accordingly and maximize profits.
Finally, it’s essential to track review frequency for each product to measure how effective your launch was. By regularly monitoring reviews for each product and adjusting pricing strategy as needed, you can increase both customer satisfaction and sales volume—ultimately leading to a successful launch on Amazon FBA!

Conclusion

Developing a perfect product pricing strategy is a critical factor in a successful Amazon business. At Cartkaboom, we understand the importance of creating a well-crafted pricing strategy that considers several factors, including production costs, shipping, handling, customer demand, and competition. Our team of experts works closely with our clients to understand their specific needs, goals, and target audience. We then use our experience and expertise to develop a pricing strategy that maximizes our clients’ profits while remaining competitive on the platform. One of the key aspects of our pricing strategy is the careful analysis of our clients’ competitors. We closely monitor their prices and sales patterns, and use that information to help our clients make informed pricing decisions. This approach ensures that our clients remain competitive while also taking advantage of opportunities to increase their profits. Additionally, we understand the importance of keeping pricing strategies flexible and adaptable. As market conditions and customer demand change, we adjust our clients’ pricing strategies accordingly, ensuring they remain relevant and competitive on the platform. At Cartkaboom, we take a holistic approach to pricing strategies that considers both short and long-term goals. Our goal is to help our clients achieve success on Amazon by developing and executing pricing strategies that maximize profits while maintaining a competitive edge on the platform.
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Krystel Borg

Krystel possesses a unique expertise in transforming company sales, thanks to her knack for devising strategic blueprints and fostering high-performing teams. Throughout her career, she’s been at the helm of businesses that have burgeoned from mere startups to eight-figure giants. She boasts two notable exits in the CPG sector, with one being the acclaimed Swander Pace Private Equity Group.
Her profound understanding of product-centric ventures spans the entire lifecycle—from conceptualizing brands to overseeing logistics, supply chain management, and devising robust digital marketing initiatives. One of Krystel’s standout accomplishments in sales is her tenure with QVC, where she not only celebrated over 100 on-air appearances but also clinched a nomination for their coveted “Rising Star” award, sharing the limelight with industry titans like Sephora.
With a proven track record of scaling startups to monumental heights—like achieving $1.5M in revenue within a year and subsequently doubling it—and salvaging firms from deficits to enjoy $1.8M profits, Krystel’s prowess is undeniable. She masterfully steered a company to emerge as an unrivaled leader in its sector by multiplying its sales from $4M to $18M in half a decade.
In recent years, Krystel has channeled her vast experience into mentoring, playing pivotal roles as a consultant or board member to embolden fellow entrepreneurs. Her versatility is further accentuated by her engagements across diverse industries

Navin Williams

With 11 years of leadership experience in Business Management, Navin Williams has consistently delivered transformative results. His leadership has championed small businesses on their path to accelerated growth, steered large enterprises towards a surge in efficiency by up to 40%, and provided strategic direction to e-commerce companies navigating the dynamic digital marketplace.
His toolkit of expertise encompasses spearheading organizational transformations, enhancing business agility, and driving process efficiency across a spectrum of domains and frameworks, with a particular emphasis on Lean principles. Understanding the unique challenges and opportunities presented by both brick-and-mortar operations and digital storefronts, Navin is adept at crafting strategies that align with specific business objectives.
His commitment to rigorous reporting ensures transparency and data-driven decision-making, solidifying his reputation as a versatile and results-driven business leader.

Jane Sampson

Jane Sampson boasts over 15 years in the Apparel & Home Fashions sector. Throughout her career, she’s demonstrated a depth of knowledge in areas like Design, Product Development, Global Sourcing, and Market Research. Her business acumen is backed by a proven record in Procurement, Business Planning, and Sales.
Central to Jane’s professional journey is JANEEN HOME LLC. This company, under her leadership, specializes in introducing new textures, designs, and prints for bedding and soft home lines. Her brand’s presence is felt in prominent retailers such as Macy’s, Ross Stores, Hobby Lobby, Bealls, and Belk.
Beyond her corporate achievements, Jane shares her industry insights as an Adjunct Professor at Baylor University. She remains committed to fostering growth and nurturing future talents, ensuring they’re equipped for success in the dynamic world of Apparel & Home Fashions.

Archana Reddy Williams

From the corporate world to the dynamic world of Amazon, Archana’s journey has been nothing short of transformative. As a seasoned management consultant, corporate leader, and a 7-figure Amazon seller, she founded CartKaboom with a vision to demystify the Amazon maze for brands.
What drives Archana? Her passion for ensuring every brand gets a fair shot at success on Amazon. CartKaboom works tirelessly as a partner, acting as a true extension of brands, ensuring they shine in the Amazon marketplace. While she cherishes working with all types of businesses, Archana’s heart holds a special place for family-owned and women-led brands. Drawing from a wealth of firsthand insights and tailored strategies, she’s had the honour of propelling many of these businesses to 7+ figure successes on Amazon.
At the heart of CartKaboom, it’s not just about metrics. Archana delves deep into a brand’s narrative and core values, designing Amazon-focused strategies that amplify their presence. From listing enhancements and keyword optimization to effective advertising campaigns, Archana ensures that brands don’t just survive, but thrive in this ecommerce behemoth. Outside the world of ecommerce, Archana is active in real estate. As an Accredited Real Estate Investor and a CRE General Partner, she oversees diverse commercial real estate ventures, bringing the same dedication and business acumen to this vertical.
At the core of it all, Archana’s faith in God and her family remain her pillars. She resides in Dallas, Texas with her husband and three kids. For relaxation and fun, she enjoys travelling, hiking, and exploring nature, seeing it as a reflection of God’s beauty. She’s also active in local church initiatives, emphasising community growth and unity.