AUM SRI SAI RAM
EDLP vs. PROMOTIONAL SALES
* Every Day Low Pricing (EDLP) is one of the pricing strategies deployed by the retailers in providing low prices for their customers every single day when they purchase products from their stores. * This concept was introduced by Samuel Moore Walton (Walton), proprietor Wal-mart Stores in order to attract his rural customers. He promised high quality, branded and unbranded products at lowest possible price, offering better value for his customer’s money. * According to (Ellickson, Misra, & Nair, 2011) EDLP is defined as, “Little reliance on promotional pricing strategies such as temporary price cuts. Prices are consistently low across the board, throughout all food departments.” * An EDLP store doesn’t offers special discounts or sudden price reduction for their products at any particular day or for any season. * Customers are assured of lower and better prices every day, for any product they buy from an EDLP store when compared against other competitive stores, in spite of their intermittent price promotion. * Also customers perceive that they won’t find products at lower price every day at stores following promotion sales strategy when compared with an EDLP store. * It helps manufacturers to reduce product volatility
* save supply chain cost from a more steady and stable demand, while also saving retailers the time and expense of periodic price markdowns * reduce retail stores demand fluctuation
* In order to attract customers and increase their profitability by enhancing their sales, some of the stores deploy promotional sales strategy where, it offer discount/lower prices for their products temporarily. * Recent studies claims that a promotional sale increases the sale of the products and results in better profitability when compared with EDLP strategy. * Some of the benefits of deploying Promotional sales strategy include increase in...
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