Dumping

Typically, an entrant is forced to choose the specific pricing strategy it will use for the products it offers. It often does it consciously and precedes detailed planning of all activities in advance, and sometimes not.

We distinguish 5 pricing strategies that can be distinguished. These are:

- cream collection strategy

- penetration strategy

- imitation strategy

-preventive pricing strategy

- rival elimination strategy

Dumping is one form of pricing strategy and consists in setting the prices of the products or services we offer at such a level that they are lower than competitive prices. Very often it is related to the fact that the price at which we sell the product is lower than the cost of its production, therefore the use of this strategy for a long time is not beneficial, and sometimes even possible. It also results from the fact that after eliminating some of the competitors, we will be able to raise the prices of our products to some extent.

This strategy also carries another risk, namely that the competition will be more malevolent towards us, perceiving the willingness to take over its existing customers and take a more significant position on the market.