[mimixco]

The basic formula would be COGS + CAC * Markup. Where COGS is the Cost of Goods Sold, what it costs you to make the product or deliver the service. CAC is Customer Acquisition Cost, or what it costs you to get a new customer. Different industries will support different levels of markup.

You also need to consider the lifetime value of the customer. If somepays pays $10/month for a subscription and the average customer stays 1 year, the lifetime value is $120. If it costs you $5/month to provide their service and it cost you $10 in advertising to acquire them as a customer, then over their lifetime you'll earn $50.

You can look at your competitors' pricing to see how much markup (and therefore how much profit) can be sustained over each customer's lifetime. If you're selling on added value (things your competitor doesn't have), you might be able to charge more than they do. If you're selling on price, you'll have to charge less.

Pricing can and should change over time, too. You might start with a high price for early adopters and go down over time. Or you might start underpriced and go up as you get adoption. Pricing also has to match up with your overall business growth goals in able to return enough to your investors to be worth it.

[themarkers]

The problem is have to estimate anything