Pricing Your Product or Service

01

Know your true cost

In simple words

If a cup of lemonade needs lemons, sugar and a cup, you must add up all three before you choose a price. If you forget the cup, you lose money on every sale.

Key facts

Cost of goods (COGS): what it costs to make or buy one item (materials, packaging).
Selling costs per sale: payment processing fees, platform fees, shipping you pay, packaging.
Overhead (fixed costs): monthly costs not tied to one sale (software, phone, insurance). Spread them over your expected sales.
Your time: if you don't pay yourself, the business only looks profitable.
Payment fees are real costs. Examples in Canada (check the current pages before you rely on them):
Stripe, domestic Canadian cards: 2.9% + CA$0.30 per successful transaction.
Shopify Basic plan, online card rate: 2.8% + 30¢.
Example: on a $20 sale with a 2.9% + $0.30 fee, the fee is $0.58 + $0.30 = $0.88.

Example (true cost of one candle)

Cost	Amount
Wax, wick, scent, jar	$4.50
Label and box	$1.00
Payment fee on $25 (2.9% + $0.30)	$1.03
Share of monthly costs ($100 ÷ 50 candles)	$2.00
Your time (15 min at $20/hour)	$5.00
True cost	$13.53

Step by step

Open a spreadsheet or a notebook and write the name of one product or service.
List the cost of goods: materials and packaging for one item.
List selling costs for one sale: payment fee, platform fee, shipping you pay.
Divide your monthly fixed costs (software, phone, insurance) by the number of sales you expect, and write that share.
Add the value of your time, for example minutes spent times an hourly amount you choose.
Add everything up to get your true cost.
Check: your true cost is higher than just the materials. Compare it to the candle table in this lesson.

LESSON 01Know your true cost

LESSON 01 / ANIMATED LESSON / AI VOICE00:00 / 01:00

Voice

Read the video script

[Host] "Most new sellers underprice because they forget half their costs."
[Screen: candle with cost labels popping up] "Materials, packaging, payment fees, monthly costs, and your time."
[Text on screen: Stripe CA: 2.9% + $0.30] "Even card fees add up. On a $20 sale, a 2.9% plus 30-cent fee is 88 cents."
[Host] "Add it all up. That number is your floor. Never price below it."

Try it now

Make a true-cost table for your main product or service using the example above. Circle your true cost.

ClaudeStuck? Copy a ready-made prompt for Claude

Copy this, open Claude, paste it, and Claude will walk you through the lesson step by step.

For a grown-up: Claude is for adults (18+). Copy this, paste it into Claude, and use the answer to explain the lesson to your child.

I'm learning "Pricing Your Product or Service" on The Future Market. Lesson 1: "Know your true cost".

What the lesson teaches:
- Cost of goods (COGS): what it costs to make or buy one item (materials, packaging).
- Selling costs per sale: payment processing fees, platform fees, shipping you pay, packaging.
- Overhead (fixed costs): monthly costs not tied to one sale (software, phone, insurance). Spread them over your expected sales.
- Your time: if you don't pay yourself, the business only looks profitable.
- Payment fees are real costs. Examples in Canada (check the current pages before you rely on them):
- Stripe, domestic Canadian cards: 2.9% + CA$0.30 per successful transaction.
- Shopify Basic plan, online card rate: 2.8% + 30¢.

The exercise I'm working on:
Make a true-cost table for your main product or service using the example above. Circle your true cost.

I'm stuck. Please:
1. Explain the main idea in plain, simple words with one everyday example.
2. Walk me through the exercise one small step at a time. Ask me what I've done so far before giving the next step.
3. Don't just give me the final answer. Help me do it myself, and check my work when I share it.

I'm a parent helping my child (about 8 years old) with a lesson called "Know your true cost" from the course "Pricing Your Product or Service".

Here's what the lesson says:
If a cup of lemonade needs lemons, sugar and a cup, you must add up all three before you choose a price. If you forget the cup, you lose money on every sale.

The activity:
Make a true-cost table for your main product or service using the example above. Circle your true cost.

Please explain this so an 8-year-old understands: short sentences, a fun everyday example, and no hard words.
Then give me 3 simple questions I can ask my child to check they understood, and a way to do the activity together, one tiny step at a time.

Open Claude

Sources

Stripe Canada pricing: stripe.com/en-ca/pricing
Shopify Canada pricing: www.shopify.com/ca/pricing

My notes

I learned this

02