Product Costs
The costs of the product—its inputs—including the amount spent on product development, testing and packaging required has to be taken into account when a pricing decisions is made. So do the costs related to promotion and distribution. Companies have to consider the breakeven point for offerings when making pricing decisions. Breakeven is where total costs = total revenue. Ideally, a company wants a product that generates revenue that exceeds its costs, but this doesn't always happen, especially with new offerings.
