Competition among the Few, Oligopoly, and Similar Market Structures - Assignment Example

In a case where there is an increase in the number of craft breweries in a market locality, the results will automatically be an increase in competition between the stores. This is due to stagnancy in the market space and increases in potential purchasing stores. The number of customers will remain constant while the number of stores increases resorting to increased competition among the traders. The profit obtained by the craft brewing industry will tend to reduce. This is because the store owners will tend to lower their prices to attract more customers and in turn lower their turnover.

Most of the turnover will be divided among the different grocery store shelves.First, breweries can manufacture different sized bottles. This will make the customers have a wide range of drinks which suit their needs at specific times. Secondly, craft breweries could manufacture drinks available in different forms like powdered and liquid. This is because some customers may intend to purchase for use at that specified time or for later use. When manufactured in powdered form, it can easily be stored for future use by the customer.

This will help target all customers and differentiate the craft breweries. Thirdly, the craft breweries could manufacture brands of different flavours. This would help break the usual sequence of a specified drink in the market and increase the sales as consumers will tend to try the new flavors. This would in turn help differentiate the craft breweries from each other.