Venture Capital

Pricing Before we set the price for our sport products and outdoor fitness equipment, we determined on a unit basis what my costs were going to be. We then determined what the market price was for the normal sport products. At this price it was determined that for all but the lowest sales projections, this product would turn a profit at this price. However, since our sport products offer additional features, we felt that we could price it approximately 10% above simple sport products. To test this price, we called a database of 50 large users of simple products. We first questioned them about the desirability of our extra features and then asked them directly if this price would be acceptable if such a product were available. We found that 75% of those polled would be interested in this product. Of this 75%, we received 10 firm orders representing approximately 30% of this group.