There is vast information on about the services and goods sold. In most cases, the buyers have not thought about their existence. For instance, the customers hardly think of the product’s producer and the overall influence in the production of the product. Some of these products have become a big part of our lives. The two questions will help us understand the competitive market and the most accurate characteristics often associated with the type of market. Moreover, we know other markets such as monopoly and
Competitive markets
A competitive market is one that has several producers presenting similar products in the same region. The producers work under different strategies to compete with each other by producing goods depending on the demand. Each firm works harder to become a mega firm before others. In this case, all companies have similar weight; hence the market is fair to all ( Liu & Atuahene-Gima, 2018 ). The concept is also present where the quantity and price of services and goods are considered. A single producer and one consumer cannot decide on the number and cost of a commodity.
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Diminishability and profits characterize a competitive market. Diminishability explains the decrease in stock as products get purchased. In this case, the price will hike. For instance, if one customer buys a red car, the number of red cars will decrease. The decrease will lead to higher demand hence causing an increase in price. Profit, on the other hand, shows interest where there is an opportunity. If there is money to be earned, then there is interest. For instance, if the company decided to produce red cars, and they realize they will get money then there is a possibility of using that money incentive to join the competition.
Examples of a competitive include farming, vehicle assembly, and education institution.
Farming
In the world, there are millions of farmers, and no one can influence the price or the market. The farmers plant and harvest the products during different seasons to meet consumer demand. In this case, they meet the requirement of competitive market because they cannot alter the prices of the products. The rates are seasonal, and the farmers have to accept the value and cost of the products during their harvest time.
Education institutions
In most cases, private schools experience stiff competition from time to time. The selection of a favorable school depends on performance and fees. All schools have their customers, but the number of returning customers relies on the quality of education. In this case, no school dictates the average fee required.
Vehicle assembly
In the entire world, the number of vehicles assembling companies is very high. In this case, there has been a mega-production of vehicles. However, there no rand that dictates the price of the other product.
Monopoly markets
Monopoly market is a market structure occupied by a single seller producing unique products. The kind of exchange works under a tight restriction from entry to the market by other firms. In this case, an individual seller is producing a specific commodity. Monopoly market does not produce substitute commodities ( Chen & Zhu, 2018 ). The fact that the seller has full control of the supply ensures that elasticity of demand is zero for all its products. The governing policy provides that no other firms are joining the industry. Throughout the year, the demand curve f the market makes a downward slope. Monopoly can also be experienced by a company that has excellent control of the market and can determine the health of other related companies.
Monopoly market is scarce unless governed by the government. However, internet service providers, Luxottica and YKK are mainly related to monopoly market.
Internet service providers
In the industry of internet provision, the idea of monopoly has hit so much. In America, ISPS have intentionally restricted other servers from stepping into another’s territory. The district system offers different servers a single company to rule a specific location. In return, the system ensures that the server does not receive any competition in the area. On the same field, other organizations such as Amazon, Google, and Microsoft have colonized the industry. Almost in every place, the above three companies have been the main could computing providers. All through the technology world, the companies have been the leading providers of bits and bytes to all Os and Is users. Bits and bytes are the fundamental building blocks in any operating system.
Luxottica
Since the discovery of eyewear, the price of sunglasses frames has remained high. The fanciest frames sell at $400 to $500. The amount does not reduce at any point of the year. The assembling of those simple frames does not cost more than $25-50. In this case, the companies pocket a considerable profit. Luxottica has led the situation. The company makes almost all the sunglasses in the world. The company has grown to a mega-firm hence controlling the price freely.
YKK
YKK is a superstar firm that has been zipping up the world. The company produces approximately 7 billion zips in a single year. Almost every cloth in the world has a zip from the company. In this case, the company is capable of changing the price of the product. The cost of a single zip has never gotten any fair to the customers. On the other hand, other companies have been unable to secure a decent market share.
Monopolistic markets
Monopoly is an entirely different market compared to monopolistic. Unlike monopoly, monopolistic dictates a market structure that contains many competitors who sell slightly different products. The fabric is mainly found in small businesses such as small stores, means of traveling and street restaurants ( Fang & Wu, 2018 ). These businesses offer various goods and possess an element of uniqueness. However, all these businesses target the same customers. Moreover, the products are aimed to serve a similar task.
Street restaurants
In every street, there’s a given possibility of finding more than one restaurant. The restaurants are meant to serve customers with food made from a different recipe. The customers are all hungry people. The products sold are food, but they can change in taste or recipe. Each restaurant hires a different chef who come with a unique method. Different restaurants compete for customers by selling similar meals with various elements.
Means of traveling
In everyday life, people are needed to move from one place to another may be for work or vacation. In main towns, different organizations offer roaming services in different ways. For instance, some companies major on cab while others use buses. The services provided are the same, but they slightly vary due to some elements.
Small stores
In most cases, small stores fetch their goods from different companies and distribute them to consumers. In the streets, stores are located next to each other. The same stores are close competitors selling similar but slightly different products. The difference is determined by their priority producing company of a particular good. As a result, customers select their favorite depending on their taste.
References
Chen, F., & Zhu, D. (2018). Price Strategy and Network-Size Allocation Strategy in a Two-Sided Monopoly Market
Fang, H., & Wu, Z. (2018). Multidimensional private information, market structure, and insurance markets. The RAND Journal of Economics , 49 (3), 751-787.
Liu, W., & Atuahene-Gima, K. (2018). Enhancing product innovation performance in a dysfunctional competitive environment: The roles of competitive strategies and market-based assets. Industrial Marketing Management , 73 , 7-20.
