Loss Leader

A loss-leader is when a company offers a product or service at a price well below the actual cost of production. Typically, a supermarket may sell baked beans at 5p per can, when it actually costs them 7p and to buy them from the manufacturer. Although they are selling products at a loss, the aim is literally to lead people into the store, so they will buy a large range of other products at the full price. In the financial services industry, credit card balance transfersare a particularly popular loss-leader.

• Find out more about balance transfers
• Student Bank Accounts