Dumping Syndrome

Dumping syndrome is a phenomenon when a company sells its product at a very low price in order to attract more customers and increase sales. This may lead other companies to lower their prices to remain competitive.

Dumping syndrome can have negative consequences for the economy as a whole. If a company continues to sell its product at a low price, this may reduce the profits of other companies, which are forced to lower their prices in response. As a result, this may lead to reduced investment in the development of new technologies and innovations, which in turn may slow down economic growth.

To avoid dumping syndrome, companies must monitor their prices and not reduce them too much. They should also monitor competitors and analyze their prices to determine what prices are optimal to sell their product.

Dumping syndrome (from the English dumping - “dumping out”, “throwing out”) is a type of fraud in which a partner sells the right to ship the partner’s products in his market (export territory of the brand) to a buyer registered in a foreign country of the product.

Dumping most often includes two elements: the provision by the buyer of discounts, benefits and guarantees that are established in the target market, but are not available to the manufacturer; creating or strengthening the buyer’s position in the market of the country where the product is produced. Price changes directly depend on these factors.

The main risks of dumping exports: * you will deprive

What is dumping syndrome?

So what is dumping syndrome? This is the psychological state of a person after the depreciation of the ruble during the devaluation on the foreign exchange market in early March of this year. The changes that have come have increased the incomes of Russians. Problems began with saving money. More than 50% of Russians try to save their savings. But against the backdrop of rising inflation in the country, the problem of a decrease in the purchasing power of money arises.

When oil prices and the ruble exchange rate fall, dollar-equivalent income depreciates. Therefore, Russia began selling oil and gold at home in order to get out of the current situation, but this turned out to be unsafe for the Russian consumer. Many have realized that it is better to save money than to invest and receive high profits, which are short-term in nature. The ruble exchange rate fell and the value of the dollar also decreased. In a scarce market, demand for goods falls. There is nothing good about this, since the production potential of companies is reduced and jobs are eliminated. The labor surplus is a consequence of a strong global economy, with people working due to highly competitive labor markets. If workers cannot find work, they leave because they do not receive decent wages. When limiting consumption due to dumping measures, it is necessary to reduce unemployment. This is caused by an increase in the number of jobs in the real sector of the economy. Therefore, the decline in income from labor is the main factor influencing the decline in consumer spending.