Analysis of key factors in product pricing in AliExpress stores

In the AliExpress platform, product pricing is one of the core elements that affects sales results. Effective pricing strategies not only involve the optimization of sales volume and keywords, but also need to consider a number of related factors to ensure the sustainability and profitability of operations. The following are several main factors that affect AliExpress product pricing.

1. Product cost

Product cost is the basic basis for determining pricing, including the purchase price and circulation costs of the product. Among them:

• Purchase price: The original price of the product purchased by the company and related taxes.
• Circulation costs: Including various costs involved in the entire process from procurement to sales, such as storage, allocation, etc.

Preventing shrinkage and considering costs are the first steps in pricing.

2. Shipping fee

Freight costs (logistics costs) are the various activity costs that need to be paid during the circulation process of products, mainly including:

• Transportation costs: Involving labor costs, operating costs, and related travel expenses, etc.
• Warehouse costs: Including the cost of building, purchasing or leasing a warehouse, as well as operating costs during the warehousing process.
• Distribution processing: Including equipment, materials and labor costs related to distribution processing.
• Packaging: Includes the cost of materials and machinery used to package products.
• Loading, unloading and handling costs: Involving labor, asset depreciation and energy consumption, etc.
• Logistics management expenses: travel, conference and system development expenses during the management process, etc.

If overseas warehouse delivery is used, additional first-way freight and warehousing costs need to be considered[1].

3. Profit

Profit is the amount left after deducting costs and taxes from a company’s revenue. Profit margin is usually used to measure a store’s profitability. It is recommended that when pricing, the profit margin should be set between 30% and 50% to leave room for subsequent marketing activities.

4. Platform commission

In AliExpress operations, sellers need to pay a commission based on a certain percentage of order sales. The commission ratio varies by category, usually between 5% and 8%, and AliExpress may adjust this ratio from time to time based on industry dynamics.

5. Promotional costs

Promotion strategy is an effective means to increase sales, mainly including:

• Store activities: Such as limited time limited editions, store-wide discounts, coupons, etc.
• Through train: Promote products by setting keywords to get more exposure and attract potential buyers.
• Affiliate Commission: Participate in affiliate marketing, use additional channels to increase exposure, and pay based on completed orders.
• Off-site promotion: Promote on other platforms (such as Facebook, Google, Instagram, etc.).
• Platform promotions: Make price adjustments during specific festivals (such as Double Eleven) or anniversaries to increase sales.

By comprehensively considering the above factors, sellers can develop more effective pricing strategies and improve the competitiveness and profitability of their products on AliExpress.