Trading Up Refers to

question 53

Multiple Choice

Trading up refers to

• A) adding product features but reducing the price.
• B) changing the distribution channel members to higher-service-quality retailers.
• C) adding value to the product (or line) through additional features or higher-quality materials.
• D) reallocating marketing resources from a poor-performing target market to one that demonstrates greater potential for future growth.
• E) offering consumers a discount when they purchase a more expensive version of the product.

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Definitions:

Freight-In

Freight-in refers to the shipping cost associated with getting raw materials or inventory to a company, which is added to the cost of goods.

Cost of Goods Sold

The expenses directly related to the manufacturing of products a company sells, which includes the cost of materials and labor.

Gross Profit

The difference between revenue and the cost of goods sold, indicating how efficiently a company produces goods.

Operating Expenses

Costs associated with a company's main operational activities, excluding direct materials, direct labor, and other direct costs, such as rent, utilities, and salaries.