I made a pricing mistake that cost me.
When I first started selling products online, I bought items for ₦8,000 each and sold them for ₦10,000. I thought ₦2,000 profit per item was solid. Then I did the math. After paying for transportation, packaging, transaction fees, and handling one damaged product per batch, I was left with ₦200 per sale. I was essentially giving my time away.
That's when I learned: pricing isn't just about marking up a number. It's about knowing your real costs and charging enough to actually stay in business.
Most beginners make one of two mistakes. They either price so low they can't afford to restock, or they price so high that nobody buys. The truth? You need to know your numbers.
In this guide, I'll share what I've learned about pricing in Nigeria—the real costs nobody mentions, how to research your market, when to stay firm on price, and the mistakes that almost killed my business.
Why Product Pricing Matters
Your price affects everything in your business.
Price too low, and you'll struggle to make enough profit to restock, handle unexpected costs, or grow.
Price too high without reason, and customers will just buy from someone else.
The balance between these two is what determines if your business survives.
For small business owners, every sale matters. If a product only gives you ₦500 profit and your time spent on it equals 30 minutes of work, you're making ₦1,000/hour. That will not leave you with enough profit to make the business sustainable.
Start With the Real Cost of Your Product
Before you set a price on anything, know what it actually costs you.
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| Tracking hidden costs is the difference between profit and loss. Write down everything |
Most beginners make the same mistake I did. They focus only on product cost and ignore everything else.
Let's say you buy a product for ₦10,000. That's not your only cost.
Your actual costs include:
- What you paid for the product: ₦10,000
- Transportation to get it to you: ₦500-2,000
- Packaging materials (box, tape, tissue): ₦300-1,000
- Delivery to customer: ₦1,000-3,000
- Payment app fees: 2-3% of sale
- Advertising to make sales: ₦1,000-5,000 per sale
- Damaged, returned, or unsold products: set aside a reasonable allowance based on your own experience.
- Phone/internet for running the business: Part of your time
Once you add these expenses, your actual cost will be significantly higher than the ₦10,000 you paid.
I learned this the hard way. I didn't track packaging costs for months. Turns out I was spending ₦500 per order. That's ₦500 I wasn't counting as a cost.
📝 DO THIS NOW: Write down EVERY cost. Use a notebook or Google Sheet. Track everything for two weeks. You'll be shocked at what you find.
Use a Simple Pricing Formula
Once you know your real costs, the math is simple:
✓ Selling Price = Total Cost + Profit You Need
Real Example:
- Product cost: ₦10,000
- All other costs: ₦3,000
- Total cost: ₦13,000
- Profit you want per sale: ₦4,000
- Your selling price: ₦17,000
That's it. No magic. No guessing.
This is your starting point. Use it as a baseline. Then check what the market actually pays for similar products.
Don't Automatically Become the Cheapest Seller
When you're new, you might think cheap equals customers. It doesn't always work that way.
Sure, a low price attracts some buyers. But here's what happens: you end up competing only on price. You get stuck there. You can never raise your price without losing those customers.
People buy for different reasons. Some want the cheapest option. Others care about quality, durability, service, delivery speed, packaging, trust, and reputation.
Ask yourself these questions instead of just "How low can I go?":
- What does my customer actually value?
- Is my product good quality?
- What makes my product different?
- Can I provide better service?
- Can I make buying from me easier or faster?
Answer these and you compete without destroying your profit.
Your Price Should Match Your Product Quality
Your price should make sense for the quality you're offerin
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| Quality customers will pay more when they see value. Package and presentation matters |
If your product is genuinely good, charge a reasonable price. Don't apologize for it. If your product is mediocre, don't charge ₦25,000 and expect respect.
Your price and quality must work together.
If two similar products exist and one costs much more, customers will ask why. That extra cost needs to be justified. Better materials. Better durability. Better packaging. Better service. Something real.
I've sold the same product at ₦15,000 and ₦20,000. At ₦20,000, I used better packaging, faster delivery, and followed up with customers. Returns dropped. Repeat customers increased. People felt the difference.
Your price sends a message. Make sure the message is true.
Research What Other Sellers Are Charging
Before you set your final price, look at what similar products cost.
Check Facebook Marketplace, WhatsApp seller groups, TikTok, Jumia, Instagram, local shops, and anywhere else selling what you sell.
Write down 5-10 prices. Look for the range.
Don't copy someone else's price blindly. They might be losing money. They might have different costs. They might already have a customer base.
Use their prices as information. Not as your entire strategy.
If similar products sell between ₦15,000-20,000 and your formula says ₦17,000, you're in range. If your formula says ₦25,000 but everything similar is ₦18,000, you have a problem. Either your costs are too high, or you need a better product.
Find an Average Price That Makes Sense
Your product doesn't have to be the cheapest or most expensive.
Most of the time, a reasonable middle price works best, especially when you're building a customer base.
If similar products sell around ₦20,000, look at your costs and quality. Decide if your price should be slightly below, around, or above that level.
The important thing: know why you chose that price. Don't pick ₦18,000 because it "sounds good." Pick it because your costs, quality, and market research support it.
Make sure the price leaves room for you to operate and grow. If you're barely breaking even, you can't handle problems or invest in growth.
Understand the Customer You Are Selling To
Not every customer has the same budget or priorities.
A budget shopper doesn't think like a quality buyer. A person looking for cheapest won't care about premium materials. A person buying for durability won't buy the cheapest option.
Think about who you're actually selling to.
Ask yourself:
- What type of customer needs this product?
- What problem does it solve for them?
- What can my target customer afford?
- What other options do they have?
- Why should they buy from me instead?
Understanding your customer means you don't price based only on what you want to earn. You price based on what they can afford and what they perceive as value.
Help Customers Understand Why Your Product Is Worth the Price
Sometimes the price isn't the problem. The customer just doesn't understand what they're getting.
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| When customers understand what they are buying, they stop asking "Why is it expensive? |
Explain your product. Show features. Explain quality. Explain size, materials, benefits, how to use it, anything that helps them decide.
This matters.
Example: Don't just write "Solar system - ₦350,000."
Write: "3kva solar system with 5 days battery backup, 6 solar panels, pure sine inverter, includes installation, 1-year warranty, supports fridge + lights + TV + laptop charging daily."
Now customers understand what they're paying for.
When customers understand value, they're willing to pay for it. They stop asking "Why is it so expensive?" and start asking "Can I afford this?"
That's the shift you want.
Don't Change Your Price Every Time Someone Complains
Someone will always say your price is too high.
That's not data. That's negotiation.
I had a customer say my ₦18,000 product was too expensive. She wanted ₦12,000. I said no. She didn't buy. Then someone else paid full price within an hour and became a repeat customer.
One person's budget doesn't set your price.
Look at the bigger picture. Are many customers saying it's too expensive? Are sales actually slow? Then maybe adjust. But don't change your price because one person tried to negotiate.
Never sell below your cost just because someone complained.
Maintain Your Price and Product Quality
Once you find a price that works, keep it.
Constantly changing your price confuses customers and makes your business look disorganized. They start waiting for discounts instead of buying.
Don't change your price every time one customer complains. Monitor your sales, costs and market conditions, then review your price when there is a genuine reason to do so.
And don't lower quality while keeping the same price. That's how you destroy your reputation.
I've seen sellers do this: keep the price the same but use cheaper materials. Product fails. Customer gets angry. Posts negative review. Business dies.
Customers remember consistency. A customer who has a good experience comes back. Buys again. Recommends you.
Price and quality consistency builds that trust.
Leave Room for Business Expenses and Future Growth
Your selling price needs to do more than just cover today's product.
Your business also needs money for:
- Next stock purchase
- Packaging supplies
- Marketing
- Unexpected problems
- Scaling up
If you spend every naira from sales without saving, you'll be stuck. You can't restock. You can't grow.
Track your sales and expenses. See if your pricing actually works.
If you want to reach more customers online, our guide on How to Start Selling Products Online in Nigeria shows you different platforms and strategies beyond a physical shop.
Common Product Pricing Mistakes Beginners Make
❌ Mistake 1: Pricing based only on competitors
Your costs are different from theirs. Your quality is different. Use competitor prices as information, not your entire strategy.
❌ Mistake 2: Forgetting hidden costs
Transportation, packaging, ads, transaction fees, damaged goods—all these reduce your profit. Track everything.
❌ Mistake 3: Making the product too cheap
Low price means low profit. Low profit means you can't restock, can't handle problems, can't grow.
❌ Mistake 4: Making the product too expensive without reason
High price without justification just pushes customers to competitors.
❌ Mistake 5: Reducing prices because of every complaint
One customer's negotiation doesn't determine your strategy. Look at trends, not individual complaints.
❌ Mistake 6: Sacrificing quality to increase profit
Short-term savings destroy your reputation. Customers expect what they paid for. Give it to them.
What If You Are Just Starting and Need Customers?
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| Price yourself right, You'll make money, your customers will respect you, your business will survive |
⚠️ Reality check: When you're starting, you might need an introductory price. Not because it's smart long-term, but because you have zero reviews and zero proof you're reliable.
Charging ₦15,000 for your first product when nobody knows you is tough. Consider ₦12,000-13,000 for your first 10 sales to get reviews.
But here's the critical part: raise the price once you have proof.
I started at ₦12,000. After 20 sales and solid reviews, I raised to ₦15,000. Then ₦18,000. My volume dropped slightly, but my profit tripled.
Starting low is survival. Staying low is the problem.
You can also attract customers without going cheap. Improve your product photos. Respond quickly to messages. Give clear information. Deliver on time. Treat customers well.
Price is only one reason people buy.
If you're using social media to promote, better designs help. Our guide on How to Use Canva to Promote Your Business and Get More Customers in 2026 shows you how to make your products look professional without hiring a designer.
A Simple Way to Review Your Product Price
Before you publish your next product price, check these five things:
- Know your total cost. Include everything—product, transport, packaging, fees, everything.
- Decide how much profit you need. What does your business need monthly to survive and grow?
- Check the market. Look at similar products and their prices.
- Consider your product quality. Is your price reasonable for what you're offering?
- Think about your customer. Can they afford this? Will they see value?
After that, set your price and watch what happens over 2-3 months. Then adjust if needed.
Final Thoughts: Price for Profit, Value, and Customers
There's no single price that works for every product or business.
The right price depends on your costs, product quality, customers, competition, location, demand, and the value you provide.
From my experience, you don't need to make everything cheap just to get customers. You also don't need to make them unnecessarily expensive.
Find the middle ground.
Trust your product's quality. Charge accordingly. Help customers understand value. Keep your pricing and quality consistent. Listen to genuine customer feedback.
When customers understand what they're buying and consistently get what they expect, price becomes smaller part of the relationship.
Remember this: making sales is not making money.
Your goal is to build a business where the price covers your costs, gives you real profit, and gives customers a reason to come back.
📌 Read Next:
- How to Start Selling Products Online in Nigeria: A Beginner's Real Guide for 2026
- How to Start a Small Online Business in Nigeria With ₦100,000 or Less
- How to Take Product Photos With Your Smartphone That Sell
- How to Write Product Descriptions That increase sales
- How to Use Canva to Promote Your Business and Get More Customers in 2026
⚠️ IMPORTANT: Prices, costs, and market rates change frequently in Nigeria. The examples in this article are based on my experience and typical market conditions. Always calculate your own costs and research your specific market before setting prices. Your profit margins may differ based on location, product type, and customer base.