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What part of "We don't price-match that" don't you understand?

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  • #16
    Quoth Killer Bees View Post
    I don't get that.

    How is it better to take a loss just to have the customer buy something? They're not making any money for the purchase as it is.

    And there's no guarantee that the customer will (a) come back and buy something else in the future or (b) come back and buy something more expensive to make up for the loss the store took before
    Well, the below cost price is determined by a careful calculation in which stores take into account the fact that not everyone buying the cheap item will buy other items. For example:

    Let's say I'm selling DVDs at a loss of $3 per disc and I'm assuming three people out of 10 will come in and buy the DVD as well as other items than I can make a profit on. Let's assume the total profit margin on these other items is $45.

    10 DVDs at a loss of $3 a disc equals a $30 total loss, but I scored $45 in profit off those other items so I'm up $15. Now that's not too much, but think if it were 100 DVDs, 1000, 10 000. That adds up to a tidy profit even though 7 out of 10 people are only buying the DVD.

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