In business strategy, selling a product below cost to drive competitors out of a market is called predatory pricing.
The alleged strategy is to accept short-term losses while weaker rivals are pressured to leave or reduce their presence. If competition later diminishes, the firm may attempt to raise prices or otherwise recover the sacrifice. The concept therefore concerns both below-cost pricing and an exclusionary objective, not merely a cheap sale.
Predatory pricing is different from penetration pricing, which usually means setting a low introductory price to build demand. A loss leader may also be sold cheaply to attract shoppers, without an intention to eliminate competitors. Whether conduct is unlawful depends on the jurisdiction and evidence, including cost measures and likely recoupment.
Competition authorities examine market power, duration, internal documents, and effects on consumers. Low prices alone are not automatically proof of predatory conduct.