Arriving at a cost structure that is both profitable and hard for potential followers to match is called a Price Minus.
A Price Minus is a pricing strategy that deducts some amount from the market price to attract more customers and increase profitability to the detriment of competitors.
A price minus can be used as a market penetration strategy.
Thus, using a price minus, a company can arrive at a cost structure that achieves profitability and deters potential competitors without instigating a price war.
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