Price-taker is an economic term describing a market participant who has no effect on overall market activity. In the investment world, a price-taker buys and sells investment securities in the market, but because the amount of securities bought or sold by the price-taker is so small, his transactions have no effect on the price of those securities across the market. In essence, a price-taker must conform to the economic supply and demand forces of that market.In the business world, a price-taker is a company that prices products based on the going market rate. Price-takers typically sell goods in markets with high levels of competition and substitute products, such as packaged food items. Customers will turn to other options if the price-taker raises prices above the market average. Therefore, the business must sell its products at the market price and look for other ways to increase profit. Companies that are price-takers generally are not leaders in their industry, or are in a saturated industry. Either way, price-takers usually have lower profits than the opposite, price-makers. Often, price-takers will sell their products at the market price, which results in a loss, just to maintain their market share. Investors looking for companies that can produce consistent, sustainable profits should invest in price-makers and avoid the companies that are price-takers.