After reviewing all the five competitive forces, my analysis showed that the weakest of the fives forces is the threat of new entry’s despite the possibilities of selling of a good with a high contribution margin, it is very challenging and expensive to develop a new competitor that could go head to head with Blue Nile and make a profit, let alone survive the competition. Supplier power is a modest force due to the fact that Blue Nile depends on one of the thousands of diamond suppliers for the diamonds they use since they do not pay for a diamond unless it is ordered first by the customer. The reason why they are not too big of a force is because there are plenty of other suppliers to turn to. The top three suppliers accounted for only 24 percent of the company’s purchases in 2009. Another modest force is competition from rivals.
Fewer companies are willing to enter the market because of the SOX requirements that make going public too costly. Plus, the maintenance required to stay public is too expensive for smaller companies, forcing companies to look elsewhere to raise capital. Rising costs persuade large numbers of companies to exit the public markets to sidestep SEC regulation, creates two problems. First, the overall economy could suffer because corporations limit investment projects due to the higher-cost sources of capital to fund potentially new operations. Second, financially stressed companies that go dark are the very companies’ shareholders need to monitor usually and where transparency is most important.
Natural Monopoly Case Telecommunication Law & Regulation Natural Monopoly Case What is Natural Monopoly? The concept natural monopoly emerges when the production of service or product can be provided by one firm more efficient and cost effective than two or more firms. In a natural monopoly there is a high fixed cost and company must overcome large barrier to entry its market. An example of barriers that a company must sustain consists of high startup costs, specialized technology, or difficult licensing and regulation requirements in an industry, limit the number of possible entrants into the industry (Hill, 2014). This means that a company is able to provide the lowest price and in addition it’s one of the fewest company’s which is capable of overcoming the challenges of startup cost in order provide a cost effect product or service for its consumers.
For the cinema market building something which can seat enough people with the right equipment (e.g. huge high definition screen with state of the art projectors) can be hard to create, due to high set up costs. Furthermore there is more to do, for example gain the rights to shoe new films, which can be very expensive unless you benefit from economies of scale. A natural barrier to entry is the exploitation of economies of scale, where the big firms in the business, in this case Vue, Cineworld and Odeon are using their economies of scale to deter any new entrant away. The top three firms have a relationship and power to obtain the viewing rights to screen 2”first-run” films and to do so at a lower price.
We thought that Product Innovation was the most important key success factor along with quality, and global strategy. We didn’t think that cost competitiveness was that important because Nike, Under Armour, and Adidas aren’t a best cost provider in fact they seem to be a differentiated provider. We believed that Under Armour was better than the other companies in product innovation because of all their advanced moisture-wicking fabric. Global strategy was also really important to us because that company has to focus on other countries besides the one that it is in. And with Under Armour struggling with their sales revenue in foreign countries we gave them a nine compared to Nike that we felt was a ten because a lot of their revenue comes from other countries.
| Case is too small- client unable to pay high fees.The imbalance in power between B.G. and Darryl is enormous.Yet Darryl refuses to be intimidated and is prepared to stand up for himself (& others) in order to compel Barlow group to seek other options. 1) Full up the quarry. (which Is more expensive). | The interests of international company and government are more important than those of individual.Even though the corp/govt is rich and powerful, Darryl believes that the rights of the individual are just as important.
The Herrestad Company has a classic problem: two products that use fixed overhead disproportionately ("Activity based costing", n.d.). That is, according to the data given in Table A below, product A uses more production runs and more sales reps than product B. Also, there are far fewer units of Product A, meaning that each unit requires a great deal of overhead resources to support. Although the sales price of Product A is high, and therefore one might think that they are charging enough to carry all this extra overhead attention, but profitability analysis indicates otherwise. Table A Use of fixed overhead resources by product line Productionruns(not$) Numberofsalesreps(not$) Total 100 25 ProdA 65 15 ProdB 35 10 Profitability will be reviewed in two parts, first we will analyze the contribution margin, and then product line profitability overall, including fixed costs.
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
The kinked demand curve shows how firms in an oligopoly are looking to protect and maintain their market share and that rival firms are unlikely to match another’s price increase but may match a price fall. To a large extent this has led to the local bus industry becoming an oligopoly at a local level where a single provider is the only firm truly competing and on a national level there is the occurrence of a monopoly where it is again these ‘big players’ who share between themselves a high concentration ratio of the national market. This is because those firms who own a large percentage of the market are able to benefit from barriers to entry in their favour. Examples of this would be the benefits of operating economies of scale or high set up costs. This would be an example of a natural monopoly where the monopolist has an overwhelming cost advantage.
In the late 1800s times were tough, living and working was brutal, due to the conditions and the lack of safety regulations, scarce supplies of food, over population due to the vast amounts of immigrants filled the cities, money was hard to come by, because monopolies were controlling the market place, influencing consumer pricing and purchasing the “haves” could get it, while the “have not’s” had to fight for it (Doc-4). The free market is the strength of this great nation, with