Keeping in mind the constraints of perfect competition, what are some pieces of advice you could give to a firm operating in a perfectly competitive market.
The reflection should be roughly one page in length.
Expert Answer
Operating in a perfectly competetive market is a big challenge. To exist and to be be successful in such market is both- SCIENCE and ART. Some pieces of advise for firm are as below:
- Be careful and cautious about cost and market condition. Even a small change in price point can become a major driver of business in short term.
- Squeeze your profit to minimum to remain a strong player in the market. There may be conditions like these but don’t worry, these conditions doesnt exist for long time.
- If possible, run aggressive programs. These programs may focus at cost (ie offering great price, discounts etc.) or differentiation (offer products that may be value for money or attract cusomer for some reasons)
- Bargain from your vendor to bring the price down.
- Take advantage of market segmentation. Every market will have different segments ofcustomer. See what segment can be served by you better.
- Try to have unique products and offering.
- Do networking as much as possible with all stakeholders
- Respect each and every customer. How specially you treat your customer matters a lot because the word spreads.
- Most important (perhaps)- Have patience.
