Fixed Price

Posted in Marketing and Strategy Terms, Total Reads: 893

Definition: Fixed Price

Fixed price refers to non-negotiable price, i.e. the same cannot be subjected to bargaining. Usually an external government sets the price (called price controls), which cannot be changed for individual sales.

Usually prices are held constant for a pre-determined period of time (called the control period), after which they might be subjected to upward or downward revision. Usually, a fixed price contract sets a price which cannot be further adjusted and are usually negotiated where costs can be accurately forecasted, demand is reasonably constant and specifications are available.


Example: At certain street markets, where bargaining is quite prominent, a few outlets clearly mention "Fixed Price" tag on certain set of clothes or goods. For those, customers have to purchase at the rate mentioned only, as no bargaining would be entertained for the same.

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