This website uses cookies to ensure you have the best experience. Learn more

Monopolistic Competition In The Retail Industry

986 words - 4 pages

Monopolistic Competition in the Retail Industry
The retail industry is a prime example of the modern version of Chamberlin and Robinson’s model of Monopolistic Competition (Grewal, 441). The retail industry consists of vast markets with different brands and goods of one common goal, to sell their products. To cater to this rapidly changing market many large scale retailers are findings ways to make their product more appealing to the public in hopes of gaining market share over their competition. As prices rise, customers are forced to buy substitutes of well-known brand names or alter their preferences. This results in the phenomenon known as monopolistic competition.
Monopolistic ...view middle of the document...

By advertising lower prices and exposing competitor’s flaws, a company can build a better brand and their product’s reputation. Thirdly, product differentiation. The four common types of product differentiation are physical product differiation, marketing differiation, differiation through distribution, and human capital distribution. In monopolistic competition, companies use color, size, accessibility, performance, and features to differ their product from the competition. Through marketing differentiation, companies change the packaging and labels on their products to make them more appealing to customers. Differentiation through distribution is made possible by offering one-day shipping and selling online instead of just in the store. Human capital distribution is seen through the direct investment in the training of employees to develop skills, customer service and knowledge of the products, which is a leading factor in whether a potential customer will buy your product or a competitors.
In monopolistic competition; however, the retail industry faces that demand is down-ward slopping. There are many firms producing very similar products and consumers must be convinced to buy one good in a market where there are endless substitutes. This has been noted in the closing of many retailer department stores. One way firms attempt to make up for lost profits throughout the year is to offer seasonal discounts. This is based on the elasticity of a good or how elastic or inelastic a good is at the time.

For example, this is a graph showing monopolistic competition during peak season for a good:


CS Supply


Q2 Q1

This shows that an increase in price will not affect the demand curve initially, as the demand for a product becomes inelastic such as in peak season. The percentage change in price is greater than the percentage change in demand. The consumer surplus is less than it would be during the normal season for a good due to the producer being able to...

Other Papers Like Monopolistic Competition In The Retail Industry

Classification Of Dangerous Goods In The Shipping Industry

2787 words - 12 pages with the transportation al Dangerous cargo that was established and enforced by the IMO (International Maritime Organization). There is also a list of dangerous goods and their classification that are mentioned by the UN (United Nation). Also giving the different classification of dangerous goods as well as what they are sub-divided into Classification of Dangerous Goods in the Shipping Industry The use of containers to aid in the

Gdp Changes In The Retail Sector In India

250 words - 1 page Changes in GDP & Employments in all the sectors : * The long-term trend of a decline in the rate of employment growth in agriculture sector. * When GDP contribution grew in secondary & tertiary sector, decline in agriculture sector. * As per table of GDP contribution in all sector, in Primary sector year 1950 was 53.71% & after that it decline every year like 1970 – 43.86% , 1990 - 33.01 & 2011- 16.66. * In secondary sector was

Comparison Of Different Types Of Media And The Impact Of Online Media In The Hotel Industry

1177 words - 5 pages Comparison of different types of media and the impact of online media in the hotel industry With more and more people are becoming internet savvy, communicates with the customer through Internet is more efficient and cost effective. Online and social media open up a new way to distribute promotion messages to potential customers. The aim of this paper attempts to analysis the difference between traditional media and online media and how

Five Competitive Forces In The Biotechnology Industry And Its Economics Scenarios

1797 words - 8 pages biological manufacturing processes and the resulting molecules. The biotechnology industry is a profitable industry; it is worth $200b and is growing 11% YoY. The industry spending is expected to grow to $210b in 2016 from $93b in 2006. In addition the industry estimates that the market for biosimilars will be worth $25b by 2020. The future of Biotech companies is bright Given the nature of its products, generic competition has been a

Current Trends In Maritime Shipping Today And The Latest Issues Faced By Shipping Industry

4810 words - 20 pages Current trends in maritime shipping today and the latest Issues faced by shipping industry Contents Page Introduction 2 Trends • Containerization

The Mortgage Industry In Kenya

509 words - 3 pages Mortgages A mortgage is a debt instrument that is secured by the collateral of specified real estate property and that the borrower is obliged to pay back with a predetermined set of payments. Mortgages are used by individuals and businesses to make large purchases of real estate without paying the entire value of the purchase up front. Mortgages in Kenya fall under two types, that is, a. Fixed rate mortgages The borrower will owe a percentage

The Importance Of Icts In Aviation Industry

4400 words - 18 pages and help treat certain diseases says a research reported by Medical News Today. What are the health benefits of grapes? Red grapes, green grapes, purple grapes, seedless grapes, grape jelly, grape jam, grape juice... the ways to consume grapes are endless! And don’t forget wine and raisins! This popular fruit’s history goes back as far as 8,000 years, when grape vines were first cultivated in what is now the Middle East. It may surprise you to

The Largest And Best Association In The Free Paper Industry

2067 words - 9 pages SAUPEC 2006 APPLICATION OF ABRUPT CHANGE DETECTION-BASED SIGNAL SEGMENTATION IN POWER SYSTEM OSCILLATION ANALYSIS A Ukil*, R Živanović* *Tshwane University of Technology, Private Bag X680, Pretoria, 0001, South Africa. Abstract. Abrupt change detection-based signal segmentation has significant role to play in automatic segmentation of signal. The segmented signal can be used for automated analysis and effective further processing

Competitions In The International Hotel Industry Is Increasingly Intensified And Globalized As Hotels Seek New Ways To Grow And Target Markets And Potential Customers Have More Alternative To Choose...

539 words - 3 pages social and economic environment. Consequently, more complicated and varied types of hotels have been brought into existence. Simultaneously, the competition to secure a strong share in the global hotel market has become fierce among hotel chains armed with a wide variety of worldwide networks. Hospitality companies can be grouped as either limited-service organizations or service intensive operations. In the hotel industry, polarization in hotel

Economics Individual Assignment

1520 words - 7 pages branded • If the firm increases its price it will not lose all its customers and if it decreases the price, it will not win all customers with competitors. Figure 4: Graphical illustration of profit in a monopolistic competition (Source: 3. Dominant Market Structure of HSBC Identification of the Market and Number of firms In Sri Lanka the banking industry can be divided into three main categories

Kudler Fine Foods

1173 words - 5 pages would be a way to lead to innovations and improve the quality in producing the fine products. In monopolistic and oligopolistic markets, innovation, and quality can be low because of the market dominance by one organization. The industry structure pushes the competition and the profitability, whether industry produces a product or service is growing. Factors can affect industry profitability in the short run in industry structure, manifested

Related Essays

Competition In The Movie Rental Industry: Netflix And Redbox

1707 words - 7 pages SUBJ: A Look at the Competition Within the Movie Rental Industry EXECUTIVE SUMMARY: Analysis: The competitive forces in the movie rental industry are quite strong, as I will explain through the five forces model. There are a vast amount of substitutes for watching a movie. You can go to a play, sporting event, concert, out the lake/beach, go for a run, watch regular television, go shopping; I could go on and on. Also, torrenting or

Competitive Positioning In The Video Game Industry

631 words - 3 pages in the realm of teenage boys. All in all, the industry is faring well with reported sales of 273 million units in 2009, generating an astounding $10.5 billion in revenue. However, it is rather difficult to enter as many games necessitate enormous investments. Not only is it tough to enter, it’s extremely competitive since the big players already own a vast majority of the best brands and are interrelated, thereby enjoying great competitive

Health And Safety Management In The Workplace In Chemical Industry

4460 words - 18 pages Curtin University of Technology Department of Civil Engineering Environmental Engineering Management 690 Assignment 2 Management of Health and Safety at Work in the Chemical Industry Prepared for: Professor Geoff Taylor By: Mohammed Alshiha Student ID: 13884145 Date: Jan 1st 2010 1.0 Introduction 1 Declaration (i) I have read and understood Curtin University’s policy on plagiarism and I confirm that the work

Key Drivers For The Growth Of Hospital Industry In Nepal

834 words - 4 pages Key Drivers for the growth of Hospital industry in Nepal 1. Technological advancement Technological advancement not only helps in the growth of the manufacturing industry but also helps in the growth of service industries like hospital by the advancements in medical technologies. Advancement in technology has shortened the adoption curve for new technologies; the benefits of the advancements are clearly visible in terms of smoothening