You state you are a small business owner. How would you react to the same offer?
The majority of my products are handmade, one-of-a-kind items. Flintlock rifles, engraved powder horns, blacksmith items, etcetera. I set my price based off of a few things. Materials cost, time to make and what I would pay for the item, if I didn't have the ability to make it. For repeat customers, I always offer some discount.
My other product, farm fresh eggs, get priced according to the current market price.