Question: A local grocery retailer with multiple stores has been facing many problems for some years with the variability of customer demand for items like pasta

A local grocery retailer with multiple stores has been facing many problems for some years with the variability of customer demand for items like pasta sauces, cereals, and bread and has now approached a consulting firm for advice. After research and discussion, the consulting firm has advised this grocery retailer to operate with their periodic price promotions and use an Everyday Low Price (EDLP) strategy instead.

Discuss why periodic promotions have been discouraged in favour of the EDLP strategy? Identify the potential risks of implementing EDLP strategy by the grocery retailer and explain why?

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