cost analysis 3

Cost Comparison
Choose a car make model and year as well as your ZIP code. Use your own car if possible.
Trade Discounts
In theory the consumer is always expected to pay the list price. Trade discounts are discounts from the list price that determine what a retailer or wholesaler pays. The difference between the net price that the retailer and wholesaler pay and the list price that the consumer pays has to cover the retailer or wholesalers expenses and the profits they make. Therefore the more hands that a product passes through the greater the difference between the amount that the manufacturer receives and the amount the consumer pays.
In reality competition causes large-volume retailers to negotiate larger trade discounts which allow them to offer a product below the list price. Another strategy that they might use is to decrease their amount of profit per item as much as possible to increase sales. Retailers will make a smaller profit on each sale but have more sales. That is why small-volume retailers rely more on strategies like personal attention convenience and shopper loyalty to compete with the large-volume retailers. (Cleaves Hobbs & Noble 2012)
Cleaves C. Hobbs M. & Noble J. (2012). Business Mathematics. Retrieved from the University of Phoenix eBook Collection database.

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