Strategies for Retailers Fighting Price Wars
Wednesday, February 4, 2009 - 10:21
in Mathematics & Economics
(PhysOrg.com) -- All retail companies want to maximize their profits, while at the same time maintaining high market share compared with their competitors. One way to do this is by promising to offer the lowest prices in the market. With this strategy, a retailer may risk a decrease in profits, but has the chance to recover the loss by capturing more market share in the future, especially if some of its competitors exit the market.