Skincare Pricing Strategy and Margin: Private Label Brands
In skincare pricing strategy, pricing and margin determine profitability. Therefore, founders must calculate costs accurately while positioning products competitively.
First, founders calculate cost of goods sold. This includes formulation, packaging, labeling, testing, and logistics. As a result, pricing decisions rest on real numbers.
Next, brands set target margins. DTC brands often aim for 70–80% gross margins, while wholesale margins differ. Consequently, channel strategy influences pricing.
Additionally, perceived value matters. Branding, packaging quality, and claims justify premium pricing. Therefore, price must align with brand promise.
Finally, founders plan for scaling. As volumes increase, unit costs decrease. Thus, pricing strategies should anticipate growth rather than short-term wins.
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