Two bits on prices

From: Mike Ford <mikeford_at_socal.rr.com>
Date: Sat Nov 3 13:40:10 2001

Prices things sell for aren't simple. The general formula is something like;

Item sold = TRUE,
      if asking price (bell curve function of perceived value, number of
end users offered to).
OR
     if Asking Price (bell curve function of perceived value, number of
resellers offered to).


What this means is that if I price an item at the "average" price, then
offering it to a few end users should result in a sale, but only if the
price is much lower would it sell with just a few resellers. The higher the
price and very rapidly the number of people you need to offer the item to
goes very high.

Obviously real life is much more complicated, with supply and demand etc.,
but the point is many things sell at really high prices because the seller
either offers it to a LOT of people, or finds people who have a much higher
percieved value for the item. Moving an item from a blue tarp at a swapmeet
to a showcase in a retail store does wonders for both.
Received on Sat Nov 03 2001 - 13:40:10 GMT