If you search in Google in “What is free?” it will give you the definition of free “Without fee or payment”. Do you think you are getting free products Nope you cannot bring anything from the outlets for free you have to pay for carry bag also.
What is free? If you are giving your clothes to someone without getting anything then it is free if you are providing food to another then it is free. But this concept won’t exist in commercial world. All the offers are just to kick your subconscious and make a business with you.
Nothing is free in this world you are paying for all the free products you get in supermarkets. We try our best to explain this.
Profit is the only motto of all the business they are not in the market to lose their money unless they are start-ups.
If you analyse the cost ladder diagram the final selling price includes Production cost, overheads and profit.
Selling Price =Production cost + overheads +price of free product+ price
So if the cost of the product is $50 and you are getting a product worth $10 as free it is not free actually they included the cost of the free product in $50 .Rather than selling it bluntly If they give any offer it’s a human nature to get something free always, so you will automatically push yourself to the store.
If two stores are selling the same product for same price but shop F is providing free but shop S is not providing any free in this scenario you can prefer shop F though you are paying for it you get something free, their profit margin is low compared to shop S .
But it is purely different from discounts on MRP in that scenario they reduce their profit margin to some percentage to push their products more than their rivals for stipulated time period buying discounted product is always wise.
It’s purely marketing strategy to attract potential customers.
So next time if you found any offer on any product think on it whether it is profitable for you or not.
Share your comments on buying free products.