Explain the disadvantages of skimming price method.

1.	Explain the disadvantages of skimming price method.
Answer» Disadvantages of skimming price method: 1. High promotional cost: In this method there is heavy expenditure on advertisement and other promotional techniques. All the entrepreneurs may not have such financial strength. 2. Short run; This method is applicable only till the competitors are not entering. As the competitors enter from window, the price skimming method has to leave from the door. 3. Innovation: Such method is applicable only to innovative products and ideas cannot be introduced for normal goods.

Answer»

Disadvantages of skimming price method:

1. High promotional cost: In this method there is heavy expenditure on advertisement and other promotional techniques. All the entrepreneurs may not have such financial strength.

2. Short run; This method is applicable only till the competitors are not entering. As the competitors enter from window, the price skimming method has to leave from the door.

3. Innovation: Such method is applicable only to innovative products and ideas cannot be introduced for normal goods.

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