loss leading

loss leading

the practice whereby a RETAILER sells a manufacturer's branded product at a PRICE below bought-in cost. Loss leading is used by retailers to attract customers into their stores in the hope that buyers will then purchase a selection of full-price products in addition to cut-price items, thus making a profit on the purchases taken as a whole. In the short run, manufacturers of products subjected to loss leading may well benefit from increased sales and profits (i.e. it is the retailer, not the manufacturer, who incurs the loss), but over the longer term the practice may undermine the product's price-quality reputation with consumers. In the UK, under the RESALE PRICE ACTS, manufacturers can take court action to stop retailers using their products as loss leaders.
References in periodicals archive ?
Loss leading might be considered by some to be a neat trick, but it is only done by firms who believe that they will make money back through customers who go on to buy other products and services.
These drawbacks include the considerable blood loss leading to blood transfusions, neurologic deficit including spinal cord lesions, late infections, pseudoarthrosis, limitation of spinal motion also affecting non-fused levels, back pain and disc degeneration in the non-fused spinal segments.
Memory loss leading to Alzheimer's disease is one of the greatest fears among older Americans.
Hardware Reference ranges are as follows:: 1) Adult bone loss leading to different spaces and their follow-up;: 2) Children, including preterm luukatodiagnostiikka and follow-up;: 3) Trauma Patients;: 4) Proteesipotilt;: 5) Metabolic disorders and body composition measurements;: 6) The international high-level research.
There is, or rather could have been a good solution to the alcohol abuse problem, if the former Government had not encouraged all hours drinking at clubs and pubs and allowed supermarkets to sell large quantities of spirits and ales at loss leading prices - that would have been to have followed the original Swedish idea of one outlet only (Systemet) to be allowed to sell drink.
A large price gap between cheap, loss leading 'value' cage eggs and more expensive free range eggs had inhibited growth.
Statistics also demonstrate that 45 percent of women between the ages of 35 and 65 will be afflicted with excessive hair loss leading to thinning.
This might well be short term loss leading to longer term failure.
He said the sector was nervous about loss leading on key lagers by the multiples and the prospect of a pricing collapse on brands like Carling Black Label.
South Africa declared at 141 without loss leading by 336 to leave the students with little option than to bat out for a draw.
Encrypting tapes helps insure against accidental or intentional loss leading to identity theft.