Quiz 14: Retail Pricing
Pricing is very important in retail industry. The prices of the products play an important factor in selling the products and attracting the customers towards the seller. The types of retailers who deal in bullion market selling gold, silver and other precious items often use high/low pricing strategy. Even the retailers selling fruits and vegetables, gasoline, etc. use high/low pricing strategy depending upon the season, week, or special events that affects sales of these types of products. The availability of these products and its demand makes the prices of these products high and low. However, the retailers who uses everyday low pricing strategy are the ones who want to bring in major footfall of customers on a regular manner. The supermarkets, hypermarkets, and grocery stores are the ones who uses everyday low pricing wherein they offer most products at low prices so as to attract the customers and to increase the sale of its products. If a retailer would switch its pricing strategy from one to the other, then the customer would not react in a welcoming manner, instead the customer would become eager and inquisitive to get informed the reason for price fluctuation. There is a possibility that the customer might switch to another brand or retailer in order to avoid paying more for the products that are offered at a higher price by the retailer
Sewing patters are marked down twice a year to move inventory and make space for new designs. The seasonal nature of patterns can impact demand. Some consumes will wait for a sale and the stock up. Others will be excited to see what's new and purchase patters at full price.
Students should consider the following in their response: Price Discrimination: Vendors cannot charge different prices to different retailers unless the cost of manufacture, sale or delivery resulting from different selling methods or quantities sold are different. Resale price maintenance: This issue has had a checkered history. Currently, however, it seems that vendors can terminate retailers who refuse to maintain suggested retail prices. Horizontal price fixing: It is illegal for competing retailers to conspire to fix prices. Predatory pricing: It is illegal to establish retail prices that are so low that competition is driven from the marketplace. Price Comparison: It is illegal to promote merchandise that is "on sale" from a "regular" price unless the retailer usually and recently has sold the merchandise at that price.