A discount is a direct reduction in the price of a product for purchases made under certain conditions or for a certain period of time. It is a tactical pricing tool used to stimulate short-term sales, reward customers, or clear inventory. A discount is a direct reduction in the price of a product for purchases made under certain conditions or for a certain period of time. It is a tactical pricing tool used to stimulate short-term sales, reward customers, or clear inventory.
Different types of discounts include volume discounts (for purchasing in larger quantities), seasonal discounts (for purchasing out of season), or trade discounts (paid to distributors for performing certain functions). Effective use of discounts can increase short-term market share, but excessive use can damage brand image and teach customers to buy only on promotion.
