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Numbers that Matter by Evan Bulmer

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CHAPTER 7

Why Discounting Is Never a Good Strategy?

The Mathematical Facts of Price Versus Volume

The most important lever of any business is the price that the business charges for its goods or service.

It is the most misunderstood lever and poorly used by many businesses.

When pressed, many business owners would much rather go on a cost cutting exercise, putting pressure on the supply side of the business, than asking more money from their customers.

This quickly becomes a race to the bottom.

The main reason given for not putting up the price is “I will lose customers and be worse off.”

There are two aspects of this thinking that are very wrong and need addressing. First there is a mathematical reality that decrees how much business can be ...

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