Differentiating Between Market Structures Essay

The structure of a market is defined by the number of firms in the market, the existence or otherwise of barriers to entry of new firms, and the interdependence among firms in determining pricing and output to maximize profits. Retail sales are indicators of microeconomic conditions presented in a given area at a particular place in time. Since Sam Walton opened his first Wal-Mart store, Wal-Mart has been making ripples throughout the micro economies of America. Wal-Mart’s market structure is typical of most of our nation’s largest corporations in that they are an oligopoly (Brown, 2010). According to Colander (2010), “An oligopoly is a market structure in which there are only a few firms and

Being such a large company with many stores and employees Wal-Mart faces many issues. Some of the issues the retail giant faces are; wages, gender discrimination, and health benefits. It seems too many that Wal-Marts has lost its way. When the recession hit Wal-Mart laid off many of its employees and because of that consumers feel the shelves are not being restock and they can’t find what they are looking for. According to Bloomberg Business Week Wal-Mart went from having 343 employees in a store in 2008 to 301 employees in a store in 2013. Even though the employee cut seems logical it is costing the retail giant business. There is no man power to keep the shelves stock and give customers the great customer service that Sam Walton envisioned. (Bloomberbusinessweek)

In US, the consumers demand of products or services offering by Wal-Mart could affected by many economic factors such higher fluctuations in foreign exchange, higher fuel prices and costs, higher inflation, higher level of unemployment, and consumer’s debt level and other factors. In general, any firm can be influenced by conditions in the global and domestic economies. During the year 2014, the U.S. economy continued to recover at a moderate pace. However, there is no assurance that such recovery trend will continue in the future. To deal with the difference in the economic environments between countries, Walmart should follow different strategy. Just like the price strategy, the price of the products may be different because of the costs is different. If both wages and expenses in a country are high, the cost of producing goods will be high also, and then the price will arise.

Using the virtual organization of Kudler Fine Foods, evaluations will be made to determine market structure and competitiveness. Kudler Fine Foods current strategic plan for 2003, marketing overview, and market surveys will provide information to evaluate how Kudler competes in its market and where its strengths and weaknesses are located. Based on the evaluation of Kudler Fine Foods an applicable market structure will be determined and the structures effects on the organization and its long-term profitability. Recommendations will be made for Kudler Fine Foods while comparing real-world organizations.

A monopolistic competition describes a common market structure in which firms have many competitors or sellers, but each one sells a vaguely distinctive product or service. One of this market structure’s characteristics is that each individual firm makes independent decisions about price and output, based on its product, its market, and its costs of production (Economics Online, 2015). Another characteristic is there is freedom to enter or leave the market, since there are no major barriers to entry or exit. The opposite of this market structure is an oligopoly. Oligopoly means few sellers. Oligopoly is the market structure in which there are only a few firms or a few firms dominate the market (Amacher & Pate, 2013). In an oligopolistic market, each seller supplies a large

Wal-Mart is the number one retailer in the world in both sales and earnings, dwarfing many of its retail competitors. It offers a full assortment of products ranging from clothing to electronics. It currently has 6000 locations predominately within the United States with over $312.4 Billion in net sales during 2006. In addition to its strong domestic presence, Wal-Mart has expanded aggressively to Canada, Mexico, and Puerto Rico with over 1000 locations within those countries. This expansion can potentially create greater economies of scale for Wal-Mart services and merchandise. The synergies created by expansion will also drive profitability in the future by providing goods and services at even lower costs to consumers. In order to enter foreign markets successful, Wal-Mart engages in both joint ventures and acquisitions. By utilizing this method, Wal-Mart intends to leverage foreign retailer's market knowledge with its own core competencies of merchandising and supply chain management (Stilgoe, 2003).

Wal-Mart is arguably the most dynamic corporation in the last 50 years in the United States, if not the world. Arising from its beginnings in Bentonville, Arkansas, it has grown to over 4,400 discount stores, super centers and corner markets worldwide. Wal-Mart continues to expand despite public criticism of its labor practices as well as complaints about their treatment of competitors. The many strengths of Wal-Mart, like their low cost production and marketing practices, will aid Wal-Mart as it continues to grow in the retail

Like all departmental and/or discount stores, Wal-Mart's strategies are focused around achieving the goals such as building a large and strong customer base, under-cutting competitors, and organization of its supply chain in the most efficient and effective manner and above all, market growth.

By reading all the articles, there are facts that Wal-Mart does and does not have effects on small mom-and-pop shops. The articles I read about Wal-Mart, Home Depot, Lowes has forced the mom-and-pop shops to close. For example the two big hardware stores have not put Ace, or even True Value out of business, they still exist throughout the United States. The only thing I can see is that people are misled; Wal-Mart has low prices. I believe it has to do with our economy. Also remember Bradlees, Building Square, Ames, Anne Hope, all based in New England. They are like Wal-Mart and Target, but they are

Price has always been the key strategy in Wal-Mart’s marketing strategy. The success of Wal-Mart’s low price philosophy and marketing campaigns has been instrumental to the company’s success in the past half century. It is clear that from Sam Walton’s first store in Bentonville, Arkansas in 1950 to the 6200 stores worldwide as of 2006, Wal-Mart has utilized the price strategy of the marketing mix to become one of the most successful companies in

As a result of Wal-Mart’s core drive to dominate every market, it has come under criticism from the majority of its stakeholders. One such criticism has been that local retailers are pushed out wherever Wal-Mart opens up one its retail stores. I have been

Walmart has been the largest American employer, with a workforce of nearly 2.2 million people and in 25 separate U.S states and it is also the single largest importer from China that was worth an estimated $12 billion in 2002. Its marketing strategy always has been to emphasize low prices with marketing campaign “everyday low prices”. Walmart is able to achieve the strategy by leveraging its buyer power and controlling its labor costs. Walmart holds on its own values in order to keep its strategy in line or stable. These values are to promise financial benefits to its stockholders by giving low prices to the customers, offering jobs to the employees, other businesses have the benefits from supplying goods and services, and communities benefit

Despite Wal-Mart’s numerous efforts, its international division’s profitability lagged well behind that of domestic operations. This is mainly due to Wal-Mart’s inability to adapt to local cultures, maintain its excellence in customer service, and maintain low prices.

Unlike the theoretical perfect competition market, Oligopolies exist in real life. A market structure that is dominated by two companies is known as a duopoly. An example of an oligopoly is the soft drinks market that is dominated by Coca-Cola and Pepsi (Zheng, 2013). Oligopolies can be categorized according to the type of product they produce. The products may be either homogeneous or differentiated. On the one hand, Homogeneous products are produced by a standardized or a pure oligopoly. On the other hand, a differentiated oligopoly produces different products (William & Allan, 2011).

Oligopoly is imperfect competition among the few; it applies to an industry that contains only a few