External Influences Flashcards
(38 cards)
What is a competitive market?
A market in which there are a large number of firms producing a similar product or service.
Only compete on price, identical products
What’s competition?
Rivalry amongst sellers to gain more market share
What’s market share?
% of total sales in a industry generated by a particular company
Advantages of physical markets for the consumer?
- Personalised experience get to try things on
- buy it and take it home straight away
Disadvantages of a physical market for the consumer?
- opening time
- location
- stock only available in store
Advantages of a non-physical market for the consumer?
- easy and accessible
- next day delivery
- all shops available
Disadvantages of non physical markets for the consumer?
- shipping fees
- can’t try things on
- scams
Advantages of a physical market for the business?
- displays
- face to face selling
- attract older generation
Disadvantages of a physical for the business?
- rent
- security
- employees
- location
- day to day running
advantages of a nonphysical for the business?
- easy to upload online
- cheaper to maintain
Disadvantages of non physical for the business?
- cheaper to maintain
- stock issues vs demand
- high return rates
- visibility
What are the barriers to entry?
Cost
Regulations
Loyalty
Technology
Land/location
What is a monopoly?
A market dominated by one seller
(Must have 25% to be a monopoly)
What is the economies of scale?
The cost per unit of production decreases as volume of product increases
What is the mark up?
Is the difference between the cost and price
What is an Oligopoly?
Where a market is dominated by a few firms
- some ability over price
- many barriers to entry
- some product differentiation
What is a monopolistic competition?
A market structure with many competing firms each of whom supplies a slightly differentiated product
- few barriers to entry
- limited ability over price
What is market growth?
The % change in the size of the market, measured over a specific period
What is market size?
Is expressed as the collective value of the goods/services that buyers purchase
What is market power?
The ability of a firm to influence or control the terms and conditions on which goods are brought and sold
What is market dominance?
A measure of market share compared to competitors
What are barriers to exit?
- difficulty of selling assets/capital
- high redundancy
- contracts with suppliers ( legal challenge if not honoured)
- leases with landlords
What’s an acquisition/ takeover?
Where control of another company is achieved by buying majority of its shares
What is a merger?
This is where 2 companies join together to form a new larger business
