Barriers to entry

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    automates an important process, people may substitute by doing the process manually or by outsourcing it. If substitution is easy and substitution is viable, then this weakens your power. 2. The Threat of the Entry of New Competitors: The second factor of Porter’s forces is the threat of the entry of the new competitors in the market as this is very general that no one will like to share the market with others. Most of the time when new companies enter the market then the old sellers have to be very careful about their strategies and they started to improve their services. It means that the markets which are generating the more profits will definitely attract the other companies to enter in that particular market. In result of this competition goes up and everyone tries to survive there and the new one tries to take the more and more share of profit in the market through decreasing the profit margin of others. Sometimes the older sellers blocked the entry of new seller and keep the same competition in the market. In the sports market, the competition remains always very high that makes the new entry very easy. For the Sports Direct, it will be very difficult to keep the same profit share as many of the new companies are entering in this industry. When some new entry occurs then the previous ones can impose some determinants so they may get rid of that. Through this strategy, they can get the loyalty of the customers and may able to keep their market share. Power is also…

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    framework that explains the differences in industry. Wind energy is a monopolistic competition because of its medium entry barriers, few competitors, and some pricing power. Solar energy has two segments which production and manufacturing is perfect competition and high tech is oligopolistic competition. Nuclear power is an oligopoly because of high barrier to entry, unique product, and government support required. The hydropower is an oligopoly market due to few firms competing and…

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    affect the businesses’ hold over the market. If competitors are offering equally attractive product and service, then business may have little power to manipulate the market situation, because buyers and suppliers have varied options available in the market to make a shift from one product to the other. 4. Substitution threats: This is affected the ability of your consumers to find a different way to do what business do. If substitution is easily available and its practical, then this weakens…

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    The threat of entry, power of suppliers, and threat of substitutes are all low within this industry. The power of buyers is marginally high since they have the power to command increasingly reduced prices and increased value. Lastly, rivalry among competitors is high within the…

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    Coles and Woolworths have an enormous market share, and with this comes increased revenue. Coles and Woolworths have shown that they can afford to lose revenue to gain market share, so from this behaviour its safe to assume that the industry makes abnormal profits. High barriers to entry is another sign that large profits are being made, Coles and Woolworths have gone to unprecedented lengths to stop new firms entering the market. Recently Woolworths purchased all the undeveloped land within the…

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    3.4 Discussion of Results The evidence is clear; large cable conglomerates like TWC, now called Charter Spectrum since its latest merger, act with monopoly power to increase prices and no one is stepping in to regulate them. With only one cable provider in most areas due to prohibitive capital-intensive entry barriers, the government has allowed the cable industry to function as natural monopolies, with limited government restrictions. With free reign on price increases, TWC camouflages many…

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    threat of entry, bargaining power of customers, intensity of competitive rivalry and bargaining power of suppliers. The threat of new entrants of the porter’s five force model refers to the threat that potential new competition pose to existing competition within the industry. This threat is the force of the model which would shape the competitive nature of the fashion and apparel industry. The fashion and apparel industry is one of high profits and this is why it has attracted many…

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    Barriers of entry as the name indicates are the factors that prohibit firms from entering the industry. Monopoly exists when a single firm dominates the market because it is the only producer of a product and there are no close substitutes whereas oligopoly exists when a few large producers of identical / differentiated products dominate the market. In case of strong barriers pure monopoly exists due to the dominating firm effectively blocking all the potential competitors whereas in case of…

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    large companies between the years 1997 and 2007, the market shares of the top 50 US companies where significantly higher in 2007. The article points out that during that time, the profits the companies collected were record-high, and the same thing is starting to happen today. The reason for this is the lack of competition in the market. In perfectly competitive markets where each company only has a small market share and there are low barrier to entry, anyone can start their own business…

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    Techcorporation Case

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    The advice to investors provided by the newsletter states that Techcorporation is the preferred choice of investment since this new company that developed the satellite technology will enter in the market of satellite tv provider that lacks competition. Despite the argument presented in the investment advice seems logical at a first glance, it lacks the evidence that this new company will has the expertise to enter in a monopolistic market. Therefore, before deciding to follow the advice, one…

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