Price is Not based on Cost.
Recently a graph of relative prices of various liquids was posted on ReflectionOf.me blog. The graph shows that HP Black Ink is the highest relative price with oil being the lowest. The comments people are leaving are also interesting. A lot are railing against Hewlett Packard and there is a discussion of the cost of the various liquids.
But PRICE is NOT based on COST.
Price is set by the value the consumers perceive. Price is affected by the competition and sometimes by the heavy hand of regulation.
So why would HP Black Ink so higher relative to other the liquids?
Remember price is a marketing tool. The price of the ink needs to be taken with the price of the underlying printer. For the consumer level printer HP make nothing. They have set the price low to get the printer into your house or office and then they can sell you the ink and make the profit.
But please price is not set by the cost of the item.
How are you setting your prices? If you are not differentiating your product or service from everybody else then you will be lead down the both of lower price. HP are differentiating their printers from the competitors which then leads to the ink sales.
Price is a marketing tool
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