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Pricing our SaaS products for global sales

Posted at — Sep 10, 2021 by Abishek Muthian

The price of the product should be always what the market is willing to pay for it, A SaaS product is not any different.

We find what our home market will pay for our product through market research and price the product accordingly but do we do that for every country we sell our product? Our SaaS products can take advantage of what tangible product sellers have been doing from the beginning of global trade i.e. pricing the product according to purchasing power of each country we sell our product.

Luckily there are Purchasing Power Parity(PPP) figures available which can save us the time for market research. PPP factor is estimated by calculating the price of some common items in different countries according to the final consumption of households and government, fixed capital formation, and net exports.

Ideally, a computer in New York and in Hong Kong should have the same price. If its price is 500 US dollars in New York and the same computer costs 2000 HK dollars in Hong Kong, PPP theory says the exchange rate should be 4 HK dollars for every 1 US dollar. -WikiPedia

To make the PPP calculation even easier, I have made a Purchasing Power Parity Calculator and hosted it on StartupToolchain. Using this PPP calculator we can easily calculate what the price of our SaaS product should be in different countries based on the price in our home country.

I hope the PPP calculator from StartupToolchain comes handy to help you set a fair price for your products according to the purchasing power of your customers for not only increasing the global sales but also to do the right thing.

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