Definition of the word list price

The term "list price" originated in the 19th century as a sales pricing strategy developed by merchants in the United States. In those times, merchants used to display prices for their products prominently on a list, known as a "price list," near their stores or inside their shops. This list served as a guide for buyers and helped them compare prices across different stores. The price list also allowed merchants to offer discounts to customers, either in the form of a percentage off the original price or a specific dollar amount. The original price listed on the price list became known as the "list price." The use of list prices has since become a common practice in various industries, particularly in the retail and manufacturing sectors. The significance of list price lies in its ability to provide a benchmark or reference point for customers when they compare products and negotiate prices. While merchants often sell products below the list price to attract customers, the list price still serves as a basis for calculating discounts and commissions. Additionally, list prices are essential in calculating taxes, as taxes are usually calculated based on the product's sale price, which can be lower than the list price. In summary, the origin of the word "list price" dates back to the 19th century when merchants displayed prices for their products on a price list as a guide for their customers. The term has since become a commonly used pricing strategy and a sales measurement tool used by merchants and consumers alike.