Definition: Price Reduction - Explained
Whenever a seller lowers the price at which a product or servce sells for, it is the practice of price reduction. To be a true reduction, the remitted amount must be less than the price that the item sold for at list price.
This discount is normally done by businesses to bring in greater total sales figures or to make way for newer products.
TipsWhen retailers engage in price reduction on a frequent basis, notable among furniture, flooring and vinyl window dealers, for instance, many consumers wonder if such a continous reduction is really valid. We've all seen or heard of the ad stating "Prices Reduced, Everything Must Go" only to discover the same ad being run in the future.
If it is a true store closing, question who will stand behind the product in the future.
To ensure prices are occurring at reduced amounts, compare these supposed knock down prices with competing dealers, look for brand names, model numbers, if the item is being stopped by the manufacturer and why, and confirm there are no added or hidden fees added to the bill. On the flooring/carpet example, fees could be shifted on to the installation. For tv ordered products, it is the shipping and handling fees not always mentioned until you heppen to make the call.