Price undercutting is not always the best strategy. Situations where it might not be advisable include:
1. Niche Markets: In niche markets where quality and exclusivity are valued, undercutting prices may degrade the brand. 2. High Fixed Costs: Businesses with high fixed costs may find it difficult to sustain lower prices without affecting overall profitability. 3. Brand Positioning: For brands positioned as premium or luxury, lowering prices can dilute the brand's image and value.