The cost of goods sold (COGS) is a key factor in determining pricing strategies. It represents the direct costs associated with producing the goods sold by a company. This includes the cost of the materials and labor directly used to create the product. In order to make a profit, a company must price its products higher than the COGS. Therefore, understanding the COGS can help a company determine the minimum price they can set for their products while still remaining profitable.
Need to evaluate the best pricing strategy for a product? This Pricing Strategy spreadsheet includes...
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