When bulk pricing is applied, the price of a product decreases, as the amount of products or services increases.Otherwise known as volume pricing, bulk pricing incentivizes customers to purchase more, as it proves to be more cost effective - the more they buy, the more they save.For example, a clothing company may charge $10 for one pair of socks, but reduce the cost to $8 a pair if a customer buys five pairs. This is appealing to the buyer and can generate more sales, as it represents a saving of $10.