Determine to make money with your product
Figuring out how to price products in your food business is important. You need to make up your mind, though, that you are going to make a profit from the start. Having this attitude will help prevent you from underpricing. Realize, too, that you need to profit so that you can expand your business later.
Know your customer well
You need to have a particular type of customer in mind so that you know how much he or she is willing to pay for your food product.
Ideally, you need to choose a specific level of quality that you will go with, and plan on sticking to it.
Your customer will come to expect it, so be sure that your prices will cover it and enable you to continue to do so.
Understand your costs and debt
When you started your food business, you may have borrowed money to get it going. You should know how much each plate or sandwich you are serving costs to make and how many you need to sell per week and month in order to break even. This is the minimum amount you need. No profit is made until you exceed that amount.
Find out what your competitors are charging
While your competitors will not determine your price, you do need to know what they are charging in order to get an idea of what the market is doing in your area. Their prices can help you know how to price your product and establish a pricing strategy.