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Loss Leaders

Don’t get me wrong, I’ll be one of the first in line to purchase items at a retailer at or below their cost; but I won’t be purchasing non-sale items while I’m there.

Selling an item without making (or even worse when losing) money is often referred to as a “loss leader“, and it just isn’t sustainable.  While a retailer might be forced to sell off inventory that isn’t moving at an operating loss to recoup part of the investment, selling a popular item as a loss leader is merely intended to increase traffic through the store.

Do the math; if a retail sells everything at or below cost, they go out of business — regardless of the volume.  In fact, the higher the volume, the quicker they go under.

I personally tend to do the bulk of my shopping at retails that offer a fair price for goods and services on a daily basis; and pickup items I use at retailers who are offering them at a substantial savings when it’s convenient (and often stock-pill those items if they’re something I use).

Let’s face it — you work hard for the money you have, and as an educated consumer you can keep more of your money in your pocket; let the retailers worry about themselves.

Caveat emptor · Cavet venditor

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