Kudler Fine Foods: Differentiating Between Market Structures

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Differentiating Between Market Structures Introduction Kudler Fine Foods is a gourmet grocery store that offers many fine foods and a wide variety of goods in the Southern part of California. Kudler Fine Foods has three locations in Southern California, the locations are in Del Mar, La Jolla, and Encinitas. Kudler Fine Foods offers a wide variety of fresh bakery products, produce, meats, dairy and cheeses, as well as domestic and imported wines. Kudler Fine Foods founder, Kathy Kudler, first opened one store in June of 1998 in La Jolla, California, and then opened the other two stores in 2000 and 2003. Her goal was to have stores that offer her customers a variety of different goods with prices that her customers could afford. Kudler Fine…show more content…
Market structures are referring to “the physical characteristics of the market within which firms interact,” (Colander, 2010). Monopolistic competitive are markets in which there are large amounts of firms selling differentiating products and there are few barriers to enter. Kudler Fine Foods falls into this category because there are numerous different grocery stores; however, they have a variety of different goods. Kudler Fine Foods would be competing against other fine food stores like Whole Foods, Trader Joes, and World Market. For Kudler Fine Foods to fall into this category means that they sell differentiating products from their competitors. They do this by offering their customers a wide variety of goods, an example would be that they offer over 250 kinds of cheese from 21 different countries, not all grocery stores offer that many kinds of cheese. One positive effect of being in a monopolistic competitive market structure is that there is no barrier for entry and that it is easy enter and leave the market at any time. One negative effect that monopolistic competitive markets face is that some differentiating does not create utility but usually generates waste (Economics Online). In a monopolistic competitive market profit is important. When a firm first enters a monopolistic market they can act like a monopoly until others join in the market which will lead to competition for lower prices. Kudler Fine Foods will compete with other fine foods for lowest prices on their goods; however, they have to make a profit in order to stay in business. In the short-run Kudler will have more profit, but in the long-run the profit will decrease to other competitors in the

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