12043085
Description
Mind Map by Jia Jun Neo, updated more than 1 year ago
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Created by Jia Jun Neo
almost 7 years ago
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Barriers to
entry
- Natural
- 1. Extensive
IEOS
- New entrants
produce at smaller
scale than
incumbent firms
- cost disadv, higher unit
COP
- ↓ ability to price g&s
competitively
- ↓ ability to price g&s
competitively
- cost disadv, higher unit
COP
- New entrants
produce at smaller
scale than
incumbent firms
- 2. High Start-up
Costs
- Prospective
firms lack
funds
- Entails
significant
risks
- e.g. air travel , railway
transport ,
telecommunications
- e.g. air travel , railway
transport ,
telecommunications
- Entails
significant
risks
- due to high k
requirements
- Prospective
firms lack
funds
- 3. Network
Effects
- product gains more value
as more people use it
- established firms have strong
network effects
- e.g. Whatsapp , Facebook ,
Instagram , Snapchat
- something new
firms will lack, hence
BTE
- e.g. Whatsapp , Facebook ,
Instagram , Snapchat
- established firms have strong
network effects
- exists only in
industries of
certain nature
- e..g. Social
Media
- e..g. Social
Media
- product gains more value
as more people use it
- 1. Extensive
IEOS
- Artificial
- 3. Intellectual
Property Rights
- Patents
- for inventions & discoveries
- e.g. Ford's patent on
autonomous police
cars
- e.g. Ford's patent on
autonomous police
cars
- Grants creators legal
right to be sole producer
& distributor of product
- for inventions & discoveries
- Copyrights
- for works of
authorship
- e.g. books, artistic
paintings
- e.g. books, artistic
paintings
- for works of
authorship
- Patents
- 2. Tariffs, Quotas &
Trade Restrictions
- Limits qty of a gd
that can be
exported to another
cty
- ↑ difficulty for firms to
penetrate
international mkt
- ↑ difficulty for firms to
penetrate
international mkt
- Limits qty of a gd
that can be
exported to another
cty
- 1. Licenses
- Grants legal
rights to
produce
- e.g. Free-to-Air
Nationwide Radio
Service Licence in
SG for radio
broadcasting
- e.g. Free-to-Air
Nationwide Radio
Service Licence in
SG for radio
broadcasting
- Grants legal
rights to
produce
- Strategic
- 1. Branding
- firm
advertises &
creates
distinctive
image for
itself or its
product
- influences csr's T&P
- Brand Loyalty
- Consumers reluctant to
switch to substitutes
- difficult for new firms to win over mkt share
- difficult for new firms to win over mkt share
- Consumers reluctant to
switch to substitutes
- Brand Loyalty
- influences csr's T&P
- firm
advertises &
creates
distinctive
image for
itself or its
product
- 2. Control over
essential
resources
- New
entrants
unable to
produce
- New
entrants
unable to
produce
- 3. Aggressive
Tactics
- Predatory Pricing
- Aggressive Advertising
- Limit Pricing
- Predatory Pricing
- 4. High R&D Expenditure
- Substantial funds
needed to match level
of competition
- E.g. Pharmaceutical, Smartphones
- Substantial funds
needed to match level
of competition
- 1. Branding
- 3. Intellectual
Property Rights
Media attachments
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