Why do stores offer buy-one-get-one deals?
Show answer & explanation
Answer: Increases sales volume and profit
Increases sales volume and profit ✓ — Correct! BOGO deals are strategic pricing tools that increase total sales volume, clear inventory quickly (especially near expiration dates), attract customers who might buy other full-price items, and create purchase urgency. Even at 'half price,' most products still generate profit because typical retail markup is 50-100% above wholesale cost.
The second item is defective — Wrong. BOGO items are the same quality as regularly-priced items. Offering defective products would damage the brand, violate consumer trust, and is often illegal under consumer protection laws. The 'free' item comes from the profit margin built into the regular price of the first item.
Stores lose money but are nice — Wrong. Stores rarely lose money on BOGO deals. If an item costs the store $5 wholesale and normally sells for $10 retail, selling two for $10 ($5 each) breaks even or makes slight profit. Plus, customers attracted by the deal often buy other full-price items, increasing overall profit. It's calculated business strategy, not charity.