Common Pricing Mistakes White Label Businesses Make (And How to Actually Fix Them)
Pricing your white-label products seems simple enough—calculate your costs, add a decent profit margin, and you’re done, right? But realistically, it’s rarely that easy. Many white-label entrepreneurs unknowingly make pricing mistakes that reduce their profit, confuse customers, or even harm their brand reputation.
Instead of giving you abstract advice or confusing formulas, let’s dive straight into practical, common pricing mistakes real white-label businesses make—and exactly how you can fix them quickly and realistically.
Mistake #1: Pricing Too Low (Because You’re Afraid to Charge What You’re Worth)
Many white-label brands price products too low to appear competitive, attract customers quickly, or because they underestimate their product’s value. The truth is, low pricing can damage your credibility and attract customers who care only about price, not quality or loyalty.
How to fix it:
Realistically assess your product quality and market position. Check competitor prices—then price your products slightly higher if your quality is genuinely superior, or clearly aligned if quality matches closely. Customers naturally associate higher prices with better quality.
Example:
If you sell premium white-label supplements, don’t compete with budget brands—clearly position yourself as premium, communicate quality, and price accordingly.
Mistake #2: Ignoring Hidden Costs (And Undercutting Your Own Profit)
Your pricing must cover not just the obvious costs (product, shipping, packaging), but also hidden costs—marketing, returns, inventory storage, payment processing fees, and your own time. Missing these costs often leaves your business struggling with poor cash flow despite decent sales.
How to fix it:
Regularly review your true costs realistically. Factor all expenses into pricing, then add a clear, sustainable margin on top. Use simple spreadsheets or basic accounting software to clearly track actual profit margins.
Example:
After reviewing hidden costs, you discover your real cost per item is actually €12, not €8—adjust pricing immediately to maintain healthy margins.
Mistake #3: Using the Same Markup for Every Product (Because It’s Easier)
Applying the same markup across all your products might feel easy, but it often doesn’t reflect true customer value or perceived quality. Some products naturally command higher margins, while others realistically sell only at lower margins.
How to fix it:
Price each product based on its individual value perception. High-demand or premium-feeling items should carry higher margins, while more generic products might have lower but still profitable margins.
Example:
If you sell both luxury candles and basic tea lights, the premium candles deserve higher markups—don’t price both at the same flat percentage.
Mistake #4: Failing to Test Different Pricing Levels
Too many white-label entrepreneurs pick a price and never adjust again. But pricing isn’t static—customer willingness to pay changes over time, and you could realistically charge more (or less) than you think.
How to fix it:
Regularly experiment with small price adjustments (10-15% increases or decreases) and track the results closely. Monitor sales and profits carefully to clearly understand your optimal pricing levels.
Example:
If raising your price slightly (from €19 to €21) has little impact on sales volume, you’ve found a simple way to significantly boost profit.
Mistake #5: Not Considering Customer Perception
Pricing isn’t just about your costs—it’s about perceived value. Customers pay based on what they believe your products are worth, not just your actual costs or markup goals.
How to fix it:
Clearly communicate the unique benefits or quality of your products. Better branding, thoughtful packaging, and clear messaging significantly improve perceived value—allowing you to charge more without customer resistance.
Example:
A white-label skincare product in luxurious, eco-friendly packaging can justify a higher price than a generic plastic tube—even if the products inside are similar.
Mistake #6: Frequent Discounting (Creating Price-Sensitive Customers)
Constant discounting trains customers to wait for sales, undermines your pricing integrity, and reduces profitability long-term. You risk conditioning your audience never to buy at full price.
How to fix it:
Use discounts sparingly and strategically—seasonal events, special occasions, or first-time customer incentives only. Maintain consistent pricing the rest of the time, so customers value your products at their regular price.
Example:
Offer one-time discounts for new customers, but clearly avoid regular storewide sales or frequent deep discounts that reduce customer willingness to pay full price.
Mistake #7: Setting Prices Once (Then Forgetting Them)
Markets and customer perceptions shift constantly. If you haven’t updated your prices recently, you risk losing profit or becoming out of sync with the market.
How to fix it:
Review your pricing regularly—every 6-12 months. Compare with competitors, customer feedback, and your own costs. Adjust prices realistically as needed.
Example:
Inflation might increase your product costs over time. Regularly reviewing and slightly increasing prices annually keeps your margins healthy without shocking customers with sudden big price jumps.
Mistake #8: Competing Only on Price (Rather Than Value)
If your entire strategy revolves around undercutting competitors, you’ll struggle to build customer loyalty or genuine profit. Price-only competition erodes profitability quickly and attracts less loyal customers.
How to fix it:
Focus clearly on communicating your unique benefits—quality, sustainability, great customer service—rather than competing purely on price. Customers willing to pay more for genuine value become more loyal and profitable.
Example:
Instead of competing on price, clearly emphasise your sustainable packaging, personalised customer support, or higher-quality ingredients. Customers appreciate and pay more for these genuine differentiators.
Mistake #9: Confusing or Overly Complex Pricing
Complex discounts, multiple price tiers, or hidden fees confuse and frustrate customers, reducing conversion rates significantly.
How to fix it:
Keep pricing simple, transparent, and easy to understand. Clearly communicate costs, shipping fees, and exactly what customers pay—no hidden surprises.
Example:
Clearly display simple, straightforward prices like €29 including shipping—rather than confusing tiers, hidden add-ons, or complicated shipping calculations at checkout.
Mistake #10: Not Tracking Pricing Results Clearly
If you don’t closely monitor pricing effectiveness, you’ll never really know if you’re leaving money on the table or hurting sales.
How to fix it:
Regularly track key metrics: conversion rates, profit per item, sales volumes, and customer feedback related to pricing. Use this data clearly to inform ongoing pricing decisions.
Example:
If a price increase slightly reduces total sales volume, but dramatically improves your total profit margin, it might still be clearly beneficial overall.
The Bottom Line: Price Smarter, Not Harder
Pricing your white-label products realistically isn’t complicated—it’s about clearly understanding your real costs, the value customers genuinely perceive, and testing regularly to find optimal pricing. Avoid these common mistakes, and you’ll create pricing strategies that boost your profits, customer satisfaction, and long-term business success.