Explore tiered pricing strategies
There are four different tiered pricing strategies that determine how prices are calculated for tiered-price Products.
What distinguishes these strategies from one another is the extent to which customers can combine different Products to get a price break based on the total weight.
When choosing a tiered pricing strategy, consider your overall priorities.
If maintaining a baseline profit margin is your top priority, use:
Or, if you're willing to sacrifice some of your profit margin to gain a competitive advantage and encourage customer loyalty, use:
To better illustrate the differences between each strategy, examples are included below based on this hypothetical set of pricing tiers:
| Tier | 1g | 2g | 3.5g | 7g | 14g | 28g |
|---|---|---|---|---|---|---|
|
Top Shelf |
$20 |
$35 | $60 | $100 | $175 | $300 |
| Bottom Shelf |
$10 |
$17 | $30 | $50 | $85 | $150 |
Price Products individually
Greenbits prices each Product according to its weight and assigned tier, independent of all other Products.
1g of any Top Shelf Product = $20
1g of any Top Shelf Product = $20
3.5g of any Bottom Shelf Product = $30
3.5g of any Bottom Shelf Product = $30
-------------
Total: $20 + $20 + $30 + $30 = $100
Use this setting if you don't want to offer price breaks based on the combined weight of different Products, and your flower inventory is all weight-based.
Combine identical Products
This is similar to Price Products individually, with the exception that Greenbits combines the weights of any two or more of the same Product:
Two of the same 1g Top Shelf pre-packs = 2g = $35 (or $17.50 each)
3.5g of any Bottom Shelf Product = $30
3.5g of a different Bottom Shelf Product = $30
-------------
Total: $17.50 + $17.50 + $30 + $30 = $95
Use this setting if you don't want to offer price breaks based on the combined weight of different Products, and your flower inventory is all or mostly unit-based.
This is a great solution for pre-packaged flower. For example, Greenbits automatically applies the 14g price when you ring up 2 quarters, 4 eighths, or even 14 single grams of the same flower.
Combine Products of the same tier
Greenbits calculates prices based on the combined weight of Products within the same tier only.
1g each of two different Top Shelf Products = 2g = $35 (or $17.50 each)
3.5g each of two different Bottom Shelf Products = 7g = $50 (or $25 each)
-------------
Total: $17.50 + $17.50 + $25 + $25 = $85
Use this setting if you want to allow customers to mix and match different Products, with limitations designed to help protect your bottom line.
Combine all Products
Greenbits combines the weights of all tiered-price Products regardless of tier.
This results in a very different calculation, especially when the total weight doesn't correspond to any of the defined weight thresholds:
1. Greenbits adds up the total weight of all tiered-price Products (1g + 1g + 3.5g + 3.5g = 9g).
2. Greenbits calculates a price per gram based on the next-lowest weight threshold, which in this case is 7g.
Top Shelf (7g = $100): $100 / 7g = $14.2857 per gram
Bottom Shelf (7g = $50): $50 / 7g = $7.1428 per gram
3. Greenbits multiplies each Product's weight by its price per gram, rounded to the nearest cent:
1g of any Top Shelf Product = 1 x 14.2857 = $14.29
1g of any Top Shelf Product = 1 x 14.2857 = $14.29
3.5g of any Bottom Shelf Product = 3.5 x 7.1428 = $25.00
3.5g of any Bottom Shelf Product = 3.5 x 7.1428 = $25.00
-------------
Total: $14.29 + $14.29 + $25.00 + $25.00 = $78.58
Regardless of tiered pricing strategy, Greenbits uses a similar calculation for any tiered-price weight that falls between thresholds and exceeds the Weigh Heavy.
Use this setting if you want to provide maximum value to your customers and make your price structure as competitive as possible.
What's next?
If you've decided which tiered pricing strategy you want to use, you're ready to set up pricing tiers!