Week 5 DQ1

Good Will in Price Bidding Sometimes, a bidder on a work contract may bid lower than what would maximize his/her profit from the contract and the reason for that is to create goodwill (to increase expected future business from the buyer). How would you value the goodwill that is obtained in this way?

When businesses demonstrate goodwill, the value applied will acquire more new businesses and retain existing relationships by lowering prices for products and services, is considered goodwill. Business goodwill is a component of business value over and above the value of identifiable business assets. According to Douglas (2012), Buying firms may wish to build up goodwill with their suppliers to ensure they will receive supplies in the future when the supplier is really...