Discounts and allowances facts for kids
Discounts and allowances are ways to make the price of things like toys, clothes, or services (like a haircut) cheaper. They can change the price a company sells a product for, the price a store sells it for, or the price listed to a possible buyer. The actual price a customer pays is called the market price.
Companies offer discounts to sell more items quickly, get rid of old stock, reward loyal customers, or help stores sell their products. Some discounts are part of a bigger plan called sales promotion.
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What are Discounts?
Discounts are a common way for businesses to lower the price of something. Imagine you want a new video game. If it usually costs $60, a discount might make it $45. This makes you more likely to buy it!
Why do Stores Offer Discounts?
Stores and companies offer discounts for several reasons:
- To sell more things: If a store has a lot of items, a discount can help them sell faster.
- To clear out old stock: When new models or seasons arrive, stores might discount older items to make space. Think of winter coats going on sale in spring.
- To thank loyal customers: Some stores give special discounts to people who shop there often.
- To encourage buying: A good deal can make people decide to buy something they were thinking about.
Different Kinds of Discounts
There are many types of discounts you might see:
- Sale prices: This is when a store temporarily lowers the price of an item.
- Buy one, get one free (BOGO): You buy one item and get another one for free or at a reduced price.
- Seasonal sales: Discounts offered during holidays like Black Friday, Christmas, or back-to-school.
- Quantity discounts: The more you buy, the less each item costs. For example, buying a pack of 10 pens might be cheaper per pen than buying just one.
- Early bird discounts: A lower price for people who buy tickets or sign up for something early.
What are Allowances?
Allowances are similar to discounts but can be a bit different. Sometimes, an allowance is money given back to a customer after they've bought something, or it might be a reduction in price for a specific reason.
Examples of Allowances
- Trade-in allowance: When you buy a new phone, the store might give you money off for trading in your old phone. This is an allowance.
- Promotional allowance: A company might give a store money to help them advertise their products. This helps the store offer better prices to customers.
- Rebates: This is when you pay the full price for an item, but then you send in a form and get some money back later.
How Discounts and Allowances Help Everyone
Discounts and allowances are good for both businesses and customers.
- For businesses: They help sell products, manage inventory, and attract new customers.
- For customers: They help save money, making things more affordable and allowing people to buy more for their budget.
Understanding discounts and allowances can help you be a smart shopper and get the best deals!
Related pages
Images for kids
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Seasonal Sales promotion
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DVD films sold at a discount when 2 items are purchased
In Spanish: Rebate (marketing) para niños
