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What is Cost-Plus Pricing?

A Popular Pricing Methodology with Significant Flaws

Cost-plus pricing involves adding a markup to the cost of producing or acquiring a product to establish the final price. It's a popular pricing methodology with some significant flaws.

In this video, I’ll:

- Dig into the components of "cost" and "markup" to see some of the challenges of this pricing policy.

- List the pros and cons of cost-plus pricing

- Identify some insights you may gain from cost-plus pricing

- Explore a "chicken vs. the egg" problem with cost-plus pricing and how to solve it

This video comes from my Pricing for Profitability Course

CPAs: Want to get CPE credit for videos and courses like this? Check out my CPE page.

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