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Many social enterprises face the challenging task of determining what are their true costs and what price they should charge for their product or service. Sometimes the current competitive market price is the main determinant and sometimes it is the cost of delivering the product or service, and the desired profit margin, that are key. Regardless of how an organization approaches the pricing decision, is important for them to know the true labour, material and overhead costs associated with delivering their product or service. In addition, knowing how to reduce these costs can often be the difference between success and failure for the social enterprise.
Here's a handy tool from JDQ Systems to assist you evaluating these decisions.
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