Chapter 2 daily assignement

Chapter 2 daily assignement - Caitlin Vodopia 8/29/2010...

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Caitlin Vodopia 8/29/2010 Strategic MGT Chapter 2 Closing Case Daily Assignment 1. The U.S. brewing industry has become more concentrated over the last two decades because: (1) beer consumption has been gradually declining, forcing companies to gain market share by stealing other companies’ customers, thus driving some companies out of business, (2) brand loyalty for mass market sellers grew for those companies that increased spending on advertising, and (3) the size that a mass market brewer has to become to receive economies of scale has grown, meaning they must produce more beer and gain more market share, and not all companies could reach minimum efficient scales of production. 2. (1) risk of entry by potential competitors – new microbrewers have low barriers of entry, because that segment does not rely heavily on brand loyalty or economies of scale, however mass market brewers face high barriers to entry based on brand loyalty and absolute cost advantages. (2) intensity of rivalry of already established companies – new customers are
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Chapter 2 daily assignement - Caitlin Vodopia 8/29/2010...

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