Here is the synopsis of our sample research paper on SHOPS, DISCOUNTS AND KNOWING WHEN TO STOP. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
This 3-page paper discusses why, from an economics factor, undercutting a competitor's price would end up backfiring for a store. Bibliography lists 1 source.
Page Count:
3 pages (~225 words per page)
File: D0_MTshopdisc.rtf
Buy This Term Paper »
Unformatted sample text from the term paper:
At the end of each year, we notice many shops selling similar items simultaneously, and giving year-end discounts. The purpose of the sales,
of course, is to move inventory so new stuff can come in and be sold at full price. The question we ask here, however, is why a firm cant under
cut its competition during other times of the year and end up with the entire market for a larger profit. On the
surface, this would seem like a logical idea - cut the prices, undercut the competition, and take the larger part of the market share. Many companies do this on a
regular basis. Some, like Walmart Inc., have raised slashing prices and taking profits to an art form. And for some companies that are trying to get rid of some old
inventory that wasnt selling at the higher prices, cutting costs is, indeed, a very good marketing and economic strategy. But Walmart is
an exception, and a very niched one at that. According to McConnell-Brues Principles of Economics, price cuts might be a short-term solution to getting more sales out the door. However,
price cuts can also be duplicated by the competition (McConnell and Brue, 2006). When a rival moves to lower prices, any potential gain in sales from a price cut strategy
is automatically cancelled out (McConnell-Blue). This is proven out time and again in price wars. In one example, during late 2002, Burger
King launched its price war by offering a bacon-cheeseburger for $.99 (McConnell and Brue, 2006). McDonalds, its closest competitor, then put a $1 tag on its Big n Tasty burger,
...