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Death by loss leader.

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politicat Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Nov-07-05 05:04 PM
Original message
Death by loss leader.
A friend works at Target, and while she's unhappy with management, her other job prospects haven't been great recently. She mentioned that the store loses a small amount of money on loss leaders (which I knew) and that percentage can be very significant in terms of profit if the store is hurting or not.

I got to thinking about this - if we buy loss leaders (and nothing else) from companies we dislike, we are costing them money. This is worse in some ways than not spending with them at all - if we don't spend with them, they don't get the dollars at all, but if we do buy nothing but loss leaders from a despised company, they're actually paying for the privilege of getting us through the doors.

If enough people did this and didn't buy anything else from despised companies, we could push them into insolvency.

I'm thinking Walmart.
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hvn_nbr_2 Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Nov-17-05 02:01 PM
Response to Original message
1. Yeah, but how do you know which things are loss leaders.
Sometimes in grocery store and drug store ads, it's obvious that some items are just to draw you into the store, and those are probably loss leaders. But they're usually out of stock too. My experience has been that if some sale items are good enough to make me choose that store that week, they won't have the items I go there for.
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Warpy Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Dec-05-05 08:24 PM
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3. Generally speaking, sale items are loss leaders
that get you into the store, preferably to the rear of the store. Others are in the grocery section, perhishables like fruits and veggies. In store bakeries are huge loss leaders, although deli counters are generally not.
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BR_Parkway Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-05 03:01 PM
Response to Original message
2. And if you use your debit card, the bank fees will deduct another
2% from them. Go on and get a little cash back while you're at it.

I haven't stepped foot in a WalMart in 3 years now, but I might for this.
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