Listen to a Business English Dialogue about List price
David: Hi Eva, do you know what list price means in business and finance?
Eva: No, I’m not sure. What is it?
David: List price refers to the price set by a manufacturer or retailer for a product or service before any discounts or negotiations.
Eva: Oh, I see. So, it’s like the initial price before any adjustments are made?
David: Exactly. It’s the starting point for negotiations or pricing decisions.
Eva: Are list prices always fixed, or can they change?
David: List prices can vary depending on factors like market demand, competition, and changes in production costs.
Eva: That makes sense. So, list prices are not necessarily set in stone.
David: Yes, that’s correct. List prices can be adjusted over time to reflect changes in the market or business conditions.
Eva: Are there any strategies businesses use regarding list prices?
David: Yes, businesses may use pricing strategies like penetration pricing, where they set a low initial list price to gain market share, or premium pricing, where they set a higher list price to position their product as high quality or exclusive.
Eva: I see. So, the list price can influence consumers’ perceptions of the product.
David: Exactly. The list price can affect consumer behavior and purchasing decisions.
Eva: Are there any risks associated with setting list prices too high or too low?
David: Yes, setting list prices too high can deter customers and lead to lost sales, while setting them too low can affect profit margins and perceived product value.
Eva: I understand. So, it’s important for businesses to carefully consider their pricing strategy to achieve their objectives.
David: Absolutely. Pricing decisions can have a significant impact on a business’s bottom line and overall success.