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Pricing Strategies in Highly Competitive Markets

Pricing Strategies in Highly Competitive Markets In most highly competitive markets, the use of certain strategicand tactical pricing practices is a key factor in determiningprofitability. Discusses the extent to which these practices can benefita firm. Evidence from research conducted in the markets of two groups ofindustrial distributors paper merchants and engineers distributorssuggests that price wars are inevitable under certain market conditions,and that a strong and defensible position in the market is a necessaryprerequisite for control of price levels. The purchase of market shareby investment, rather than competition, emerges as the preferredstrategy for firms wishing to make a longterm commitment to remainingin a highly competitive market. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Management Decision Emerald Publishing

Pricing Strategies in Highly Competitive Markets

Management Decision , Volume 30 (4) – Apr 1, 1992

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0025-1747
DOI
10.1108/00251749210014770
Publisher site
See Article on Publisher Site

Abstract

In most highly competitive markets, the use of certain strategicand tactical pricing practices is a key factor in determiningprofitability. Discusses the extent to which these practices can benefita firm. Evidence from research conducted in the markets of two groups ofindustrial distributors paper merchants and engineers distributorssuggests that price wars are inevitable under certain market conditions,and that a strong and defensible position in the market is a necessaryprerequisite for control of price levels. The purchase of market shareby investment, rather than competition, emerges as the preferredstrategy for firms wishing to make a longterm commitment to remainingin a highly competitive market.

Journal

Management DecisionEmerald Publishing

Published: Apr 1, 1992

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