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If you're fairly new to eBay, or business in general, you may be scratching your head and wondering why your profit isn't what it should be. This article looks at some ways to plug the profit hole and keep you

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

afloat!

There are two main aspects to ensuring profits in business - and this applies to any business, eBay or otherwise. Let's look at them in turn. The first is the gross profit margin.

This is the term a

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

pplied to the portion of any sales amount that is the profit element. For example, if an item costs you $50 and you sell it for $100, it's tempting to think you've made 100% profit. This is incorrect - what yo

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

u have in fact done is applied a 100% mark-up to your cost, which equals a 50% gross profit margin. This, for newcomers to business, is a common mistake and can give the trader a much rosier view of their prof

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

t margin than is real.

Also, the difference between gross profit margin and nett profit - the magic 'bottom line', so called because the nett profit always appears on the bottom line of a profit and loss shee

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

t - is something not always fully understood by newcomers to business and trading. Put simply, nett profit is what you have left after everything else is paid out. These payments include such things as rent fo

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

r premises, rates, staff wages, transport and insurances. These cost elements are usually known as overheads.

Although a full explanation of overheads is beyond the scope of this article, basically they are,

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

s described above, anything that is not classed as 'direct costs' - defined as what you pay for your stock. Too often these overheads are either ignored or simply forgotten - and this can have a disastrous eff

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

ect on the difference in the amount of money you should be making and the amount you actually are making.

This difference can, in some businesses - especially those in high-volume, low-margin markets - mean e

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ither success or failure. So - what can be done to ensure that this does not happen to your business? For that we turn to the second aspect of ensuring profits in business: price setting.

Price setting litera

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

ly means just that - setting the price for any item that you are selling. Again, a full discussion on price setting is too large in scope for this article but, basically, you must set a price for your item tha

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

t will do two things - firstly, the price must be competitive (you have to sell your goods!) and secondly the gross profit margin must be sufficient for you to make the nett profit you require.

This may seem

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

very straightforward but there is one 'hidden' charge that is regularly overlooked by those traders who use eBay and PayPal on either a regular basis or as a core business vehicle. This is, of course, the perc

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

entage charges levied by eBay for listing your items and also the final value fees. As for PayPal, the charges for accepting money via their service are significant. In fact, to set a price for an item that wi

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

l take into account eBay and PayPal charges the formula is cost price + required profit + 15%. This is a rough figure but certainly not far off the mark and a good 'rule of thumb' to work to.

What this means

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

in real terms is this: buy an item for $50. Say you want a 50% gross profit margin - plus $50. Now say you sell your item. Your overheads (so you think!) equal $30, leaving you with a nice $20 bottom line nett

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

profit. Whoops! You forgot the eBay and PayPal fees! These equal roughly 15% of you sale price which is $15. Suddenly your $20 nett profit is reduced to a measly $5!

This equation is even more important when

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

selling items on eBay by the auction format. It's very tempting to just put the item on at $5, or $9.99, or whatever - 'because everyone does that'. I beg to differ. Many people may do that but the ones making

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

money are those who stick to a formula such as the one I've listed. If your item does not sell, or regularly falls below the price you think is viable - choose another market or maybe another supplier.

The m

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

oral of this article is simple. Always, always examine all your costs before setting your selling price. Failure to do this may not result in total disaster - but you will be making far less than you should be

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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