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The price gap in retail refers to the difference in prices between two or more retailers for the same product or service. It represents the variance in pricing strategies employed by different retailers within a market.

This disparity can arise due to several factors, including variations in overhead costs, procurement methods, economies of scale, and branding strategies. Retailers may choose to price their products higher to convey a sense of exclusivity or quality, while others may adopt a lower pricing strategy to attract price-conscious consumers.

The price gap can significantly impact consumer behavior and purchasing decisions, as customers seek the best value for their money. Retailers often analyze and adjust their pricing strategies based on market dynamics, competition, and consumer demand to remain competitive and maximize profitability.