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One of the most common issues we see in business planning comes down to pricing. Not because business owners don’t care about it, but because pricing decisions are often made without careful consideration. Someone looks at what competitors are charging, picks a number that feels reasonable, and moves on.
The problem is that pricing only works when it’s viewed in context. And that context has two sides that must be analyzed together: competitor pricing and your own cost structure.
We saw this clearly in a recent client case.
The starting point: “This is what everyone else charges”
A client came to us with an established specialty coffee shop. She had done her homework on the market. She knew exactly what nearby cafés were charging for drinks, pastries, and grab and go items. Her pricing closely mirrored theirs, especially for her most popular product: lattes.
On the surface, everything looked right. Her prices were competitive. Customers weren’t complaining. Sales volume was solid.
But she was frustrated because profitability wasn’t where it should have been.
Looking beyond the menu price
We began by analyzing competitor pricing, not to change it immediately, but to understand the market's ceiling and floor. That part confirmed what she already suspected. Her prices were aligned with what customers in her area were used to paying.
Then we shifted the conversation to something that hadn’t been fully broken down before: her internal cost structure, product by product.
When we analyzed her latte, the numbers told a very different story.
She used higher-quality beans, alternative milks, and more generous portions than most competitors. Her labor costs were higher due to longer preparation time and staffing levels. Rent was above average because of the location. Once all direct and indirect costs were properly allocated, each latte was costing her far more than she realized.
The margin was razor-thin.
At the same time, other items on her menu, like drip coffee and certain baked goods, had much healthier margins. They required less labor, had lower ingredient costs, and turned faster.
What changed once the full picture was clear
This wasn’t about raising prices across the board or racing to the bottom to match competitors. It was about making informed decisions.
With both competitor pricing and internal costs on the table, she was able to rethink her strategy. Some prices were adjusted slightly where the market could support it. Certain offerings were repositioned. Others were redesigned to improve margins through portion control and cost adjustments. Marketing efforts shifted toward products that actually drove profitability, not just volume.
Most importantly, her business plan stopped relying on assumptions and started reflecting reality.
Why this matters in business planning
Competitor pricing tells you what the market is willing to pay. Your cost structure tells you whether you can survive and grow at those prices.
Ignoring either one creates risk. Matching competitors without understanding your costs can quietly erode margins. Focusing only on internal costs without respecting the market can price you out of demand.
When these two analyses are done together, pricing becomes strategic. Projections become credible. And the business plan becomes something you can actually operate against, not just present on paper.
A final thought
Pricing is never just a number on a menu or a line in a spreadsheet. It’s the result of market reality meeting financial reality.
Taking the time to understand both often changes how business owners see their operations, and it’s frequently the difference between a plan that looks good and one that truly works.
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The information provided in this blog is intended solely for informational purposes. While we strive to offer accurate and up-to-date content, it should not be considered legal advice. Immigration laws and regulations are subject to change, and individual circumstances can vary widely. For personalized guidance and legal advice regarding your specific immigration situation, we strongly recommend consulting with a qualified immigration attorney who can provide you with tailored assistance and ensure compliance with current laws and regulations.
Visa Business Plans is led by Marco Scanu, a certified coach from the University of Miami with a globally-based practice coaching Fortune 1000 company executives, entrepreneurs, as well as professionals in four different continents. Mr. Scanu advises clients on turnaround strategies and crisis management.
Mr. Scanu received a bachelor’s degree in Business Administration (Cum Laude) from the University of Florida and an MBA in Management from Bocconi University in Milan, Italy. Mr. Scanu was also a Visiting Scholar at Michigan State University under the prestigious H. Humphrey Fellowship (Fulbright program) with a focus on Entrepreneurship, Venture Capital, and high-growth enterprises.
At present, Mr. Scanu is the managing partner and CEO at Visa Business Plans, a Miami-based boutique consulting firm providing attorneys and investors with business planning services in the areas of U.S. and Canadian immigration, SBA loans, and others.
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