Examples Of Price Undercutting

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PRICE UNDERCUTTING: ETHICAL ISSUES

Values and ethics forms one of the important characteristics of an individual within an organization. Values and ethics are determined by the factors such as culture, religion, and a lot more that affect the beliefs of the individual. There can also be clash between different individuals due to the difference in the values and ethical perceptions they possess. The individuals should be able to identify the right and wrong things that affects the individual in relation to the values and ethics.
An Organization is an organised group of people with the aim of a particular business. As the number of people within an organization is large, the chance of getting into ethical issues is high. The organization should
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Price undercutting is also covered in which the distributors of a particular company trespasses the other distributors of the same company and sells the product at a discounted rate. The first distributor thus loses the sales and the second one achieves the sales target in a short period of time. Every retailer or wholesaler opts for those distributors who can provide the product for a discounted rate. These irregularities in price of the product can also affect the future market share of the product. It is always better for the companies to adopt the same pricing strategies at the different stages of the distribution network. Adopting different prices for the same product at different stages of the distribution network can make the customers to lose the reliability on the distribution network as well as the company. There should be proper understanding between the distribution networks of a particular company. The areas which cover under the particular distribution point should be decided upon by the manufacturing companies of the particular product. There should also be proper area or sales executives in order to look after the particular areas, covering under each distribution point. Price undercutting is common within the companies (ie, within the distribution points) and also within the competitor products. Business implements…show more content…
A branded product manufacturing company doesn’t focus on the reduction of the price of the product, but on providing the quality product on time. Too much reduction of the price can also make the customers to have a negative impact on the product and thus can affect the future sales of the same. When a competitor undercuts your company 's pricing structure for products or services by offering them at a lower cost, it can present a serious challenge to sales, particularly because many firms are still operating at narrower margins in the wake of the economic
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