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Issues you may choose to review in depth:
What is the market? Who are the major competitors with close substitutes? How muchmarket power does your particular company hold in this market? What barriers to entryreinforce your company’s market power? If your company lacks market power, what arethe major obstacles to gaining market power? Are rival firms doing largely the samething or is there substantial product differentiation? Does product differentiationinclude related goods or services that are sold alongside your feature product?What is the general market structure for your industry? Is it best thought of as amonopoly, oligopoly, or monopolistic competition? What characteristics suggest this isone market or another? Is the price high enough to cover costs and do there appear tobe above-normal profits? Is the market structure changing over time or expected to?What are the important barriers to entry?What are the two or three major determinants of demand in the market? What are therelevant controllable and uncontrollable factors? Have the most important factorschanged at all in recent years? Has anyone estimated price elasticity of demand for yourproduct or the larger product categories? If not, see if you can collect some price andquantity points and perform your own analysis (holding all else besides price andquantity constant). If this isn’t possible, describe which of the major demand shifters arethe most dominant—tell us which direction demand shifts and how far. There is no needto draw generic demand and supply curves—just explain thoroughly in words and leaveit up to the reader to recreate that simple diagramWhat is the relevant cost structure for the industry and for your firm? How does yourcompany avoid the sunk-cost fallacy and hidden-cost fallacy? What labor market skillsets are needed for your company and are there readily available workers to hire? Whatdoes the market for important inputs look like? Does your company have many or fewoptions from which to source important inputs? Is the hold-up problem a concern? Arethere economies of scale? Are there economies of scope or diseconomies of scope?Are there large fixed costs? How do the variable costs compare to the fixed costs interms of relative size?Is your firm able to practice price discrimination? What form of price discrimination ismost relevant in this industry and are there other opportunities that your firm has not yettaken, and why? Remember, there is a difference between price differences caused bycost differences! If price discrimination is possible, how is your firm able to accomplishthis effectively? Are there opportunities to enhance your firm’s ability to practice pricediscrimination?