Ways to Reduce Costs for an Organization
Determine ways to create nonprice barriers to entry based on market structure. Larson ability to keep prices reasonable, but profitable he can cause his market structure to be nonprice in order for other firms to gain access. By Larson keeping his market structure non-price he can keep control on that market and control other competitors from coming and winning a geographical area. Larson could spend on marketing power. If he can flood the media with his brand, this will cause the other competitors either to spend twice as much or not at all; and since they are out for a profit most likely, they will not spend on media. Flooding the media will also continue to keep Larson brand on the minds of consumers when in need of the product. Larson can also differentiate its product by quality and eco friendliness. Larson could also control and own resources to the production of the process and this will cause a block for competitors
Larson can also put patents and licenses on his products. “A patent is the exclusive right of an inventor to use, or to allow another to use” (McConnell, Brue, & Flynn, 2009, p. 203). This will cause other competitors limited ideals and room to match or copy Larson’s product. If anything were similar or even used to duplicate Larson’s ideal his competitors would have to get permission from him. “Licenses are also effective this is where the government may also limit the entry into an industry or occupation” (McConnell, Brue, & Flynn, 2009, p. 204). These have been known to be the most effective when creating non-prices barriers for entry into a market.
Colander, D. (2008). Economics. (7th ed.). New York: McGraw-Hill/Irwin
McConnell, C.R., Brue, S.L., & Flynn, S. (2009). Economics (18th ed.). New York, New York: McGraw-Hill/Irwin.
Determine Ways to reduce costs for an organization
Larson goal is to find effective ways to reduce cost while still making a profit. Larson needs to look at the company finance and decide what
Larson can also put patents and licenses on his products. “A patent is the exclusive right of an inventor to use, or to allow another to use” (McConnell, Brue, & Flynn, 2009, p. 203). This will cause other competitors limited ideals and room to match or copy Larson’s product. If anything were similar or even used to duplicate Larson’s ideal his competitors would have to get permission from him. “Licenses are also effective this is where the government may also limit the entry into an industry or occupation” (McConnell, Brue, & Flynn, 2009, p. 204). These have been known to be the most effective when creating non-prices barriers for entry into a market.
Colander, D. (2008). Economics. (7th ed.). New York: McGraw-Hill/Irwin
McConnell, C.R., Brue, S.L., & Flynn, S. (2009). Economics (18th ed.). New York, New York: McGraw-Hill/Irwin.
Determine Ways to reduce costs for an organization
Larson goal is to find effective ways to reduce cost while still making a profit. Larson needs to look at the company finance and decide what