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Itemize and discuss the issue of price cuts and the advantages and disadvantages of price cutting...

Itemize and discuss the issue of price cuts and the advantages and disadvantages of price cutting traps. Provide one clear, specific example of a price cutting situation and its result.

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Price cutting usually done by brands to attract more customers and increasing the sales. This tend to reduction of margin of per products but this will help to create economies of scale by more volume of sales. The advantage is more sales can be driven, better reach of products to different class of buyers in the market. Disadvantages are it tend or influence the buyers purchasing mind or decision , it reduces the brand premium feel as it become more reachable to all class of people.One of the price cutting example is from Samsung on their smartphones which enhances their sales of many models but at the same time many premium customers tend to chose other high end brands. It was able for samsung to kill many competition levels but it has got its own pros and cons.

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