Eco 365 Uop Differentiating Between Market Structures Essay
1031 WordsFeb 17, 20135 Pages
Differentiating Between Market Structures
Kudler Fine Foods is the brain child of Kathy Kudler. She envisioned a one stop gourmet food store and has grown to three locations to date. She continues to maintain direct control over large bulk purchase order items, stringent customer service policies, and hiring. This paper discusses how the organization competes in the marketplace and the strengths and weaknesses of the company according to the marketing surveys their customers completed. The following also discusses which market structure best applies to the organization and how that structure positively and negatively affects the firm, how the effectiveness of the competitive strategies in the market structure affect the…show more content…
That sentiment is not a reflection on how knowledgeable the customer service person was since customers overwhelmingly voted positively when asked that question. Overall, the customers felt good about the organization, how the company is branding itself as a premier gourmet market, the quality of the products and the knowledge level of the service representative.
Best Market Structure
The best market structure for Kudler Foods is oligopoly. Oligopoly, as defined by Colander (2010), “A market structure in which there are only a few firms and firms explicitly take other firms’ likely response into account; there are often significant barriers to entry.” Oligopoly requires strategic thinking. A real life company that has the same market structure as Kudler Foods is Whole Foods Market. Whole Foods Market carries specialty, gourmet food items, meats, wines, cheeses, and bulk food stuffs. Whole Foods Market also offers food and wine tastings, and attracts a wealthier clientele who fancy themselves as “gourmet foodies.” A large portion of their inventory is organically produced. Their customer service levels are a point of great pride as they know it is not just the food but the service that keep customers coming back. (Whole Foods Market, 2013) There are however, positive and negative effects of this market structure.
Positive and Negative Effects
A negative effect of oligopoly is that it is largely inefficient – economically and in