I’ll start with a few comments to @jackie‘s answer:
While it may seem easy to compare the prices of unflavored teas online, I’d say it is mostly impossible to do so. The only cases where it is possible (within limitations) is with a ‘branded’ product like a specific pu-erh cake (the limitations come from the myriad of falsely labelled and fake products out there). How would you compare the price of, say a Yunnan Golden Bud from brand A and brand B? They might look similar on the product pictures but, on the wholesale market, might have a price difference of 100-400%. And just because brand A labels their product as super premium doesn’t mean that it actually is that.
You also might think that you’re on the safe side with teas from former British colonies that have the familiar “quality” labels such as SFTGFOP. Not good, either, since these labels firstly mean very different prices at different tea gardens and secondly, different batches from the same garden often carry very different price tags and are of very different quality.
The only way I see to solve this problem is to try out a few vendors that carry tea at price levels that you are comfortable with and see what they deliver. Then, build a relationship with these vendors since honest business is always built on trust. And trustworthy vendors won’t try to cheat their customers.
@ginko: This is of course the crucial question for any small business and especially for business that result from a passion for the product and a drive to share this product with others. As you mention, there’s much more to the cost (for the seller) of a product than the wholesale price. For many countries, the shipping cost for tea and especially teaware is a significant portion of the total cost. And labor, of course, is another big factor – although that’s the one hardest to put a value to.
In my opinion, there are a few different approaches to pricing and you should choose the one that you feel most comfortable with.
a) Look at your competition. At what they offer at what price, what selection do they carry, what quality and what target market do they have. Then compare their offerings to yours. If they are similar, and the target audience is similar, stay within their price range.
b) Look at your cost (total landing cost, i.e. product cost, shipping, taxes, packaging, etc.) and apply a uniform markup on your products. This markup often falls in a fairly broad range, anywhere from 30-150%, with 50-80% probably being the norm.*
c) Do adaptive pricing based on original wholesale price. Cheaper products can take a larger markup since the perceived final price is still cheap while expensive products couldn’t carry such large markups (i.e. markup your cheaper teas at 100% and your exclusive, very expensive teas at 20%).
It all depends on your personal approach to your business. I don’t think that option a) reflects your personality or your business, so it’s probably something between b) and c). I personally use a mixture of these. As with any labor of love, you need some products to keep the show on the road, those products which pay the bills. These are products that are relatively affordable and you can sell a lot of. Mark these up a bit more than you’d usually do, since the extra 1$ or 2$ won’t turn a customer away. But – and I think you might be a bit like me in this regard – it’s probably the more exclusive, unique and rare teas that are of real interest to you. These are often very expensive directly from the producer and can’t take much of a markup if you want to sell any of them. You’ll need to subsidize them with the ‘money-maker’ teas.
I have come across the conundrum with offering very high quality teas at ‘too low’ a price. While my intention was to make a special tea affordable for anyone to try, my pricing turned away these customers that were looking for a high-end tea (which it was) and misjudged the tea as a result of the low price tag. This is a problem I would rather not have to live with, since it feels wrong to me to markup a product beyond my comfort zone only to stand its position in a (price) comparison. But this situation is a result of our past shopping experiences and the the profit-maximizing strategies of many businesses.
I realize that I haven’t given you that magic number that you asked for, but I think it boils down to what you personally feel comfortable with.
* For anyone who thinks these numbers are on the high side: most resellers of big brands have markups of 200+%. Ever wondered how they make money with “Everything in store 50% off today” sales?