Term
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Definition
Perceived benefit / Price
-can be increased by increasing benefits or decreasing price |
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Term
| 4 considerations in setting retail prices |
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Definition
1. price sensitivity
2. competition
3. Cost
4. Legal Constraint |
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Term
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Definition
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Term
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Definition
Substitute products and lots of alternatives
-pop |
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Term
| Legal and ethical pricing issues |
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Definition
Predatory pricing
Horizontal price fixing
bait and switch tactics
Scanned vs. posted prices |
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Term
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Definition
| selling below cost to drive out competition |
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Term
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Definition
Two gas stations decide to drive up prices so that it leaves the customer no choice
-illegal |
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Term
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Definition
Advertising a cheap TV and when the customers get to the store, "Sorry we are out"
-illegal
-deceptive |
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Term
| Scanned vs. Posted Prices |
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Definition
| The price on the label is lower than the price scanned and charged to the customer |
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Term
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Definition
| (retail price- cost of merch) / Retail Price |
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Term
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Definition
| (how many bought X price per unit) / price sold |
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Term
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Definition
to get rid of slow-moving, obsolete merch
to generate cash to buy additional merch that will turnover |
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Term
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Definition
-To increase sales and promote merch
-To increase traffic flow and sale of complementary products generate excitement through a sale |
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Term
| Traditional Approach to Markdown Decisions |
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Definition
Sell-Through - Identifies markdown items when its weekly sell-through percentages fall below a certain level
Time-based- cuts prices on the basis of how long merch has been in the store |
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Term
| Liquidating Markdown Merch |
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Definition
-Sell the merch to another store (Marshalls)
-Consolidate the unsold merch into one store
-Place merch on the internet auctions
-Donate merch to charity (Full tax refund)
-Carry merch over to next season |
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Term
| High/low pricing advantages |
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Definition
-increases profits through price discrimination
-sales create excitement
-Sells merch |
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Term
| High/low pricing disadvantages |
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Definition
Train people to buy on deal and wait
Has an adverse effect on profits |
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Term
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Definition
Emphasizes the continuity of retail prices at a level somewhere between the regular non-sale price and the deep-discounted sale price of high/low
-assures customers of low prices
-reduces advertising and operating expenses
-reduces stockouts and improves inventory turnover |
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Term
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Definition
| is the practice of adjusting prices up or down in response to demand to control the sales generated (Cardinals charge more for Cubs games or a restaurant “Early Bird” special) |
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Term
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Definition
Some merch is priced lower than usual to attract more customers
-This will attract cherry pickers (People who go to several stores to purchase items) |
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Term
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Definition
Car Wash
-Eliminates confusion of many prices
-Merchandising task is simplified
-Gives buyers flexibility
-can get customers to "trade up" |
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Term
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Definition
-$9.99
Customers perceive as $9 without noticing |
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