1) First, look at the customer- the ability and willingness to pay.
2) Next, look at the offer – what is available and what you are willing to provide.
3) Then consider value – assign a number to economic value to the offer.
4) Do a marketplace check – look at price alignment with others and where you want your offer to be positioned and perceived.
5) Cost and profit check – ask what will it take to have a profitable business.
This is adapted from a recorded interview with Janene Liston.