> refreshing to see some considerations that go into making decisions like this Most businesses over a certain size figure out their "COGS" (Cost Of Goods Sold

> refreshing to see some considerations that go into making decisions like this Most businesses over a certain size figure out their "COGS" (Cost Of Goods Sold) which is what it costs to produce and sell their product if the scale goes through the roof. Then they decide what the "margin" is (the mark up that we get to keep ourselves). And there is your price. Some premium products are based on super high markups/margins, but in competitive areas the margin is usually lower than 50%. The MOST competitive areas (like food in supermarkets like Safeway) get as low as 20% margin. Now, the COGS doesn't include salaries of certain people in the company like the software engineer's salaries to produce the service. The reason those aren't included is they only write the software once, then you can sell it an infinite number of times. So the margin/markup goes into paying the software engineer's salaries. So the margin isn't ALL "profit we keep in a big swimming pool and swim around in". Programmers like me learn all of this in the first year of running their first startup company, so it isn't a secret. :-) I think the business majors learn in their freshman year of college.