predatory pricing
Predatory pricing is a business strategy where a company sets its prices extremely low, often below its costs, to eliminate competition. The idea is to attract customers away from rivals and gain market share. Once competitors are driven out or weakened, the company can raise prices again to improve profits. While this tactic can lead to lower prices for consumers initially, it may harm competition in the long run, reducing choices and potentially leading to monopolistic practices. Predatory pricing is often scrutinized and can be subject to legal challenges due to its anti-competitive nature.
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Predatory pricing is a business strategy where a company sets its prices very low, often below cost, to drive competitors out of the market. The aim is to eliminate competition, allowing the predator to eventually raise prices once it has a monopoly or significant market share. While this practice can lead to short-term benefits for consumers, in the long run, it may reduce competition, harm innovation, and result in higher prices once the competition is diminished. Regulatory authorities often monitor and take action against such practices to maintain fair competition.