Diamond and other high-end jewelry purchases are expensive, and many customerswill trade off other factors for the Tiffany customer experience when making such purchases.Moreover, when spending thousands of dollars for a single item, customers often want to see andfeel what they are buying. Zales does not have the product variety and availability that Blue Nileprovides, nor does it have the brand name advantage that Tiffany enjoys. The weaker brand isreflected in the firm’s margins, which are lower than those of Tiffany. Blue Nile’s focus on lowprices is reflected in the lower margins it has relative to both Zales and Tiffany. Blue Nile operates out of one warehouse, with its entire
Summarize the case in five sentences Because there are many porcelain makers in Jingdezhen, the quality of products are low,the styles are limited, and the productivity are low. Most porcelain makers set minimal profit margin goals to pursue volume pricing strategies in the mass market, that cause their works could be mediocre quality and customers could shift to other suppliers. JCAC want to differentiated itself from its rivals by quality and artistic style of its products, and produce high-end product. What are the problems (and the origins of these problems) facing the porcelain/ceramics industry in Jingdezhen? Most of the porcelain makers in Jingdezhen unable to offer uniquely designed products and differentiate themselves from their competitors.
MGMT 4020 June 24, 2013 Homework Assignment #2 Competition is very high in the North American wholesale club industry. Every wholesale club wants to sell top-quality products at prices less than others in order to attract draw customers. And they all want to display low prices on pallets or inexpensive shelving, therefore, they have very low costs for store decor and fixtures, have comparatively low labor costs, and spent minimally on advertising and customer service. Five Forces Analysis 1. Bargaining Power of Buyers is moderate.
Bloomingdales is a higher end store that sells high quality products at a high price. They are currently losing many customers because the economy will not move out of the stagnation period. Right now the customers need to be saving their money in case they need it later to pay bills rather than spending it on clothing. Many consumers are starting to shop at stores like Macy’s or Kohl’s where they are offered almost the same quality products at lower prices. Some of Bloomingdales biggest competitors are Neiman Marcus, Saks Fifth Avenue, Bergdorf Goodman, Barneys New York, Lord & Taylor and Nordstrom.
Extract 1 shows that brand loyalty for online news is very low. Figure 1 also indicates that “the most popular quality daily paper, got just 8% of their online news from its website”. The second refers to sunk costs. Internet has provided a new entry point for many markets. Online news has low sunk costs, and it is very easy to set up.
However, due to limited financial and human resources as well as the risk associated, only one market entry at a time is feasible. Genicon’s Strategy As 80% of its business is derived outside the United States, Genicon’s strategy is clearly based on international expansion and growth in order to sell the premium-priced disposables. In this context and in regard to the limited human and capital resources it is critical to enter the right market. Market entry mistakes, high-up front costs, or long start-up times will jeopardize the continuity of the small company. Although, the products are categorized as premium-priced and high quality and economies of scale, due to the small size of the company, cannot be realized, production and distribution costs are relatively low.
Monopoly often has high barriers due to various reasons. Firstly, when there is very high economies of scale of the existing monopoly firm, the starting cost of potential entrants will be very high as a result, and this is often because of high fixed costs, such as massive initial capital outlay followed by declining LRAC. Secondly, when there is limited and small market size, localized monopoly might arguably be present because the demand from the consumers is very low due to say a small population, which cannot support more suppliers. For example, there will be only one hairdressing shop in a small town because of its small population.
Bargaining power of denim fabric suppliers is low due to the low margins and intense competition. Threat of substitutes is high as there is no switching cost and many other apparel types are available. Bargaining power of buyers is also established as a high threat. Before the recession premium denim brands targeted “aspirational” middle – class consumers, but this target group had traded down in 2009 to less
E) a small percentage of companies in the industry are currently earning above-average profits, entry barriers are high, and buyers are not brand loyal. 7 INCORRECT Which of the following conditions generally raise the barriers to entering an industry? A) Low levels of brand loyalty on the part of customers and the presence of more than 20 rivals in the industry B) Rapid market growth, low buyer switching costs, and weak brand preferences and customer loyalty C) Product offerings that are pretty much standardized from rival to rival D) High capital requirements, difficulties in building a network of distributors-retailers and securing adequate space on retailers' shelves, and the likelihood that industry incumbents will strongly contest the efforts of new entrants to gain a market foothold E) The industry is not characterized by scale economies and/or sizable learning/experience curve effects and few firms in the industry hold key patents and/or possess significant proprietary technology not readily available to a
Envelopes (322232), has a concentration ratio of 51.1%. Electronic computers (334111), has a concentration ratio of 75.5% The data according to the US Census Bureau, economic census(2002) , Women's and girl's cut & sew dresses(315233), which has a concentration ratio of 21.6% has high competition because the 4 largest companies control only a small portion of the market less than half. Therefore they don’t have that much big influence on the market. Envelopes (322232) and Electronic computers (334111), which has a concentration ratio of 51.1% and 75.5% respectively, has low market competition because the 4 largest Concentration Ratios in Manufacturing companies in each industry control more than half of the market share. So these industries have a big influence on the market.