Mental Model: Price IncentivesGuest Post
By Greenwood Investors
What better day to discuss the power of price incentives on a business than Black Friday? There is none, and so let’s dive right in with our thesis: temporary price incentives undermine the quality of the demand for a company’s products and inflate near-term financials at the expense of the long-term viability of the fundamentals. We can also invert the argument that brands and companies that refrain from temporary discounting in order to clear inventory or make the “quarterly numbers” reinforce the strength of their brand and the underlying fundamentals of their businesses . . .
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