Controversy
In recent years, loss-leader pricing has been practiced with considerable success, especially by large national-discount retailers. The strategy, however, is not without controversy; indeed, many states have passed laws that severely limit or explicitly forbid selling products below cost. Lawsuits alleging that some loss-leader pricing strategies amount to illegal business practices have increased in recent years, though the plaintiffs have not always been victorious. Opponents of loss leading pricing practices argue that the strategy is basically predatory in nature, designed to ultimately force competitors out of business.
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