Dumping - it is a risky way to deal with competitors

Dumping - a concept associated with the behavior of the market in a particular competition.The literal translation from English means "dumping."The term was borrowed from the early 20th century.It is a deliberate reduction of prices below the market average.

The purpose of such events is to attract more consumer goods (services), the desire to strengthen its position in the market to get rid of unsold goods, go to the lower price category, cause similar behavior of competitors, forcing them out of the segment, etc.The winners in that situation in the first place still consumers.

In some jurisdictions, dumping - is unacceptable (unfair) method of price competition.Against him at the international level in favor of the WTO.

dumping often used to break and gain a foothold in foreign markets (other country or region).There are two main types of dumping: price and value.The first type is the sale of goods for export at prices lower than the national market.Stoimostnyyzhe dumping - is the sale of goods for export at a cost that is lower than the cost of its production.

also emit sporadic dumping (in the form of sales to reduce inventories of non-liquid goods) and permanent (systematic sale of goods in order to obtain comparative advantages).

Often dumping private producers that participate in the tender for public procurement.Their goal is to gain access to federal funding.

dumping - is a tool to influence the situation, which can bring both benefit and harm.Young, newly opened companies to compete against stronger opponents in such a way would be very difficult.However, this is the most obvious solution, as it does not require additional investments (such as advertising in the media).But dumping - it's a risk.Lower prices may hurt the company's reputation, since the majority of consumers believe that a low-quality cheap goods.On the other hand, the game is able to adjust the prices against your competitors.

Monetary dumping is the difference between the depreciation of the national currency in comparison with the smaller reduction in its value (purchasing power) within a country.Exporters consequence of such a situation are able to implement acquired at low domestic prices products in the foreign market for hard currency, and then earn a gain by exchanging it for the national currency.

If your competitors are dumping, this does not mean that it is imperative to engage in a "price war."More reasonable is the policy of isolation in the market due to the unique qualities of your product.Even the "Black dumping" (mass or wholesale sale of goods at reduced prices) may not lead to excessive demand, as the market for it is not always quite extensive.So often it becomes dumping by bankruptcy.

from dumping a whole suffer both producers and individual sellers, and governments that receive less taxes.