Pricing Products on Lazada: A Complete Guide for Cross-Border Sellers

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Setting prices for online products can sound easier than it is. I know it from personal experiences when working with clients.

In case you sell cross-border on Lazada, you not only deal with six different markets, there are also a number of important sales events in each country.

Not only do you need to work around different currencies, but also get the discount levels right.

In this article, I won’t go into detail regarding how much you should discount your products. But, you’ll learn many other important things that can increase sales and reduce the risks of getting products delisted.

The components that build up your total product price

First of all, let’s have a look at the different parts that make up your total product price. As shown by Lazada:

Product cost + Commission + Payment service fees + Shipping + Tax/Duty + Other fees + Profit = Final Price

And a short explanation about each:

Product cost

The costs you need to pay when you produce or procure a product.

Commission

Lazada pocket a commission that usually ranges between 1-4% for cross-border sellers. In the case of Vietnam, commissions can reach up to 8%.

Keep in mind that Malaysia and Thailand add on a VAT/GST to the commission.

Payment service fees

Lazada has partnered up with Payoneer and World First as payment providers. A payment fee of around 2% will be collected for each sale.

Shipping

Shipping costs to Lazada’s sorting centre in Hong Kong and delivery to end customer. You can find the rates when shipping to ASEAN countries in Lazada’s Rate Cards.

Don’t forget to include the shipping costs from your country of manufacturing to Hong Kong as well.

Tax/Duty and other fees

As it speaks, you need to include the country specific import duties when selling to customers in ASEAN.

Profit margin

The profit margin you get when selling your products.

What should I check before setting prices for my products?

Before you update your prices in seller center, you should learn how to price your products to maximize sales in the different markets (read: ASEAN). Below I’ve included some important steps you should take into consideration.

Compare your prices with competitors

Comparing prices with competitors on not only Lazada, but other marketplaces, is crucial for sales success. Lazada even helps you with competitor price analysis, to avoid that customers choose other websites over Lazada.

Their team work continuously helping sellers to fine tune prices to increase sales and customer satisfaction.

Checking prices in offline stores

By visiting different physical stores and see what products sell for give you’ll get a good overview about your offline competition. I know it’s not that easy if you live in the US or Europe, for example, and sell cross-border.

So an online comparison will probably make it in that case.

The importance of discounts

Asians love discounts and I personally buy discounted products in a majority of the cases on Lazada Vietnam.

When you sign up to become a seller on Lazada, you first need to enter a retail price (the original price) in the seller center on Lazada’s platform. You also have the option (which I highly recommend) to include a sale price (discounted price).

In Indonesia, Philippines, and Vietnam, identical products will be listed with the cheapest product first. This gives sellers a big advantage, of course.

Malaysia, Thailand, and Singapore used the same model before also takes search relevance into consideration nowadays.

How high can the discounts be?

Lazada has set the limit to a maximum discount of 80%. In case you use more than 80% in discount, your products will be delisted.

Sales campaign prices

Lazada has four different annual sales promotions that should be of interest:

  • Lunar New Year Sales: End of January – beginning of February
  • Lazada Annual Anniversary: March
  • Ramadan Festival: May – June
  • 11:11 and 12:12: 11th of November and 12th of December

During this time, Lazada will send out so called Deal collection emails, for interested sellers. You can participate by simply updating the campaign prices and press the submit button in the email sent by Lazada.

You can also add more SKUs by using the Promotion tool in seller centre.

You’ve probably heard about the sales successes that many companies experience during the 11:11 event in China, for example. Participating in sales events can boost your sales significantly.

Limitations when setting product prices

You cannot set prices freely, but there are some regulations you need to comply with. Be sure to check Lazada’s requirement in detail when becoming a seller.

Below I’ve listed some of the most useful information.

What is the minimum and maximum price I can use for products?

You can choose a price between USD 1 – USD 1,500. Prices that are not within this range will result in delisted products.

What happens if I include the wrong pricing?

We all make mistakes due to not paying attention or due to human errors. Using wrong prices can result in order cancellations and hurt sales. Thus, it’s important that you minimize these mistakes as much as possible.

For example, you can only use the currency used in your country of destination when pricing your products. Also, Singapore and Malaysia are the only countries where you can use two digits (e.g. SG 23.39).

Learning and paying attention to such small details is important to increase customer satisfaction.

Check the prices carefully before you upload them on Lazada, as this will reduce your workload and increase sales!

How can I change wrong product prices?

Easy. Just follow the below steps:

  • Change SKU status to “Inactive”
  • Update with correct price
  • Contact HKPSC
  • Change stock to “0” and then activate the SKU
  • Check status in Seller Center
  • Sell SKUs at correct prices
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