Using a leisure market of your choice, discuss the extent to which it may be considered to be an oligopoly. An oligopoly is a market that is dominated by a few firms who have a high concentration ratio. Oligopolies frequently maintain their positon of dominance in a market because it is too costly for potential firms to enter the market. This is called barrier to entry, and due to this they can earn supernormal profits (see figure) as they can protect themselves from competition in the long run. For the cinema market building something which can seat enough people with the right equipment (e.g.
A monopolistic Competition market has many sellers and provides good substitutes but differentiates their products from other companies. The nature of competition in a monopolistic market focuses on marketing, special features and pricing (Colander, 2010). Kudler Fine Foods has only a few competitors in the market that offers the same products and service to its customers. This market structure has negative and positive effects. A positive effect of Kudler Fine Foods in a monopolistic market structure is that they lead in the market and can increase competition between companies and make massive profits by setting higher prices (Colander, 2010).
Threat of New Entrants is weak. Entry barriers are high because of the economy, significant experience-based cost advantages, other cost advantages held by industry members (e.g., access to inputs, favorable location), brand loyalty (which comes from membership and other services), strong network effects and high capital requirements. 5. Substitute Products or Services is moderate. Warehouse clubs like a magnet for customers and pulling them away from other traditional retail channels such as supermarkets, department stores, drugstores, office supply stores, consumer electronics etc… All three warehoused club rivals - Costco, Sam’s and BJ’s – have similar strategies: Low prices, low operating costs, geographic expansion – Costco; Sam’s Club concept is to sell merchandise at low profit margins, which means at low prices to members; and BJ’s offers brand-name merchandise at prices that were significantly lower than the prices found at retail, supermarkets, dept.
In a highly competitive business world, on a firm’s priority list is the subject of increasing profit and reducing cost. One might than pose the question, has this put them out of business (mom and pop store)? The answer is absolutely not, but rather, they too benefit from cheaper prices as they continue to buy in bulk and continue to operate as the name suggest, convenient
An example of this could be social security benefits. These motivations help the company recruit top level employees and increase their overall productivity. But this can be a trade-off as these benefits and rewards can be costly. Takeaway 2 - Corporate Culture, Human Resources, and Ethics Zappos is a great example of a company that has created a lively atmosphere for their workers through their casual working environment. But another takeaway is that this type of culture is not compatible with many companies.
The customers displayed the overall cost of merchandise is a bit high. They do appreciate the loyalty and bonus programs, but achieving these loyalties and bonuses should not cost so much. Kundlers foods could experience an increase in customer satisfaction if they slightly reduced the cost of their products and services. Market research is a very important part of an organization's strategy to implement expansion and variation. Part of this research must include the competitor’s strategies.
Company G has prided itself on cultivating relationships with it's suppliers built on honesty, confidence, and allegiance in order to facilitate profits for both parties. However, as popularity may grow for the product so too may the market and suppliers might consider increasing costs, in which case a fixed contract would be discussed. Threat from Substitutes – If the Little Wonder does prosper their may be threats from substitutes from larger companies that are able to produce a similar product on an increased scale thereby reducing it's price and making it difficult for Company G to compete. SWOT Analysis A SWOT analysis has been done for Company G and the outcome is clearly positive. The details of that evaluation: STRENGTHS Dedication from management, employees, and suppliers 1.
Threat of new entrants: The threat of new entrants is high. The major barriers for a startup to enter the industry are the economies of scale and the distribution channels necessary to be profitable. Due to the relatively little differentiation among companies in the industry, customers tend to visit the closest and most convenient store instead of sticking to a particular one, which makes wide distribution of the business quite essential for the fast food restaurants. Threat of substitutes: The threat of substitutes is also high. Firms in the fast food industry and home meal replacements have to continuously innovate to maintain various product differentiations and high quality of food and service in order to stand out against competitors.
Making sure that product is manufactured on time (taking into account any delays that may arise from overseas manufacturers) and ready for distribution when the consumer needs it. It is very hard for the dealerships to be able put their names behind a product that is difficult to keep in stock as todays consumers are on a “I want it now” basis. The advantage to this strategy is that if you have marketed and advertised properly, there will be demand at the dealerships from your product. If you are able to keep the dealerships properly stocked, then they will be pleased, as well as the customers and you will make your money back from all that costly advertising. A disadvantage would be that it will take resources to be able to keep items in constant stock and staff to ensure that logistics is running
As known that Costco is focusing on high quality of merchandises at relatively low prices, they have one condition in order to purchase merchandises at low prices, which is number of purchases. For example, to have one product that is cheaper than competitors they have to purchase more from original manufacturers. Therefore, Costco realized that they have to keep the sales volume to be high so they are still able to maintain this advantage. Because of this, they try to keep their slogan in customer minds that Costco has lower prices and they try to same membership money. However, there is a problem that Costco has to deal with is that their profits mostly from its membership fees instead its net income.