What is the strategy for obtaining discounts for purchasing larger quantities called?

The strategy for obtaining discounts for purchasing larger quantities is referred to as the Quantity Discount Model. This model is designed to incentivize buyers to purchase in larger volumes by offering reduced prices per unit for higher quantities. The underlying principle is that when a buyer commits to purchasing more items at once, the seller can reduce their costs, which can be passed on to the buyer as a discount.

This concept is commonly used in various industries to manage inventory costs and encourage larger or bulk purchases. It benefits both parties: sellers can achieve economies of scale in production and inventory management, while buyers benefit from lower prices. The Quantity Discount Model plays a significant role in pricing strategy and purchasing decisions, enabling businesses to optimize their operations and reduce costs effectively.