Monopoly Vs Oligopoly In June 2010 the total value of trade-in-goods imported to the UK from countries outside the EU was 15.4 billion. Competition policy: Effective competition provides goods and services cuts prices, raises quality and expands customer choice, allows technological innovation. Under the system, European Union governments set limits on the amount of carbon dioxide emitted by energy-intensive industries and if they want to emit more CO2 than their quota, they have to buy spare permits but most supermarkets stores do not manufacture and this means that they will have to use eco friendly methods of business and equipment. collected. Best tips on how to write a literature Review? Competition allows technological innovation to flourish. they will be extremely affected by any slowdown in the UK food market. The European Union Commission can allow companies like Asda and Morisons to cooperate in developing a single technical standard for the market as a whole. In this type of competition the companies are forced to follow the competitive pricing strategy in order to survive in the industry, i.e. It was founded by Jack Cohen in the East End of London in 1919. Example of oligopolistic business industries are: supermarkets such as Tesco which alone owns 30.4% which is nearly 1/3 of the UK supermarket retail share market share, banking industry, chemicals industry, oil and energy industry, medical drugs and also the news and media broadcasting industry. Actual monopoly is where the firm has somewhat majority of the market share in the industry, in this case Tesco is the most famous example, Tesco owns over 30.4% of the market share and is the leader in supermarket industry. can use them for free to gain inspiration and new creative ideas for their writing Contacting their MEP and cast vote at the European Parliament elections the European Parliament enacts EU laws: (www.europarl.europa.eu). Because the Euro would have the enhanced credibility of being used in a large currency zone, it would be more stable against speculation than individual currencies are now. In 2015, Tesco's ad spend declined sharply to less than 80 million, marking a huge shift compared to just . The total 2010 year to date value of UKs trade-in-goods exported excluding June 2010 was 45.5 billion, which has been downwardly revised by 6.9 million. In a perfect competition there are few entry and exit barriers, in this type of competition the companies target the mass audience and they differentiate their product with minor changes in the product attributes (Homogenous). Contacting their NGOs (consumer associations, environmental pressure groups, etc.) One of the few reasons that the United Kingdom did not want to join the single European currency with the first wave of countries on 1 January 1999 is that according to the chancellor of the Exchequer at that time in 1999 who was Gordon Brown our current prime minister said that, "although the government supported the principle of the single currency Britain would not be ready to join at least until the second wave of countries" which occurred in 2002 and during that time he told the European Union that the country should begin to prepare for monetary union but up till now there have been no indications of the United Kingdom joining the European Union currency, Euros. This aid can take many forms loans and grants, tax breaks, goods and services provided at preferential rates, or government guarantees which enhance the credit rating of a company compared to its competitors but in this case this does not apply to Tesco till today as Tesco is already on top of its game. For Part 1 I will be describing the 4 different market structures that economist usually talk about are perfect competition, monopolistic competition, oligopoly and monopoly. One central bank cannot set inflation at the appropriate level for each member state. Find out more about our Board and Executive Team. Market structures are the business orientated characteristics of a market; all businesses must focus on these characteristics of the market because these have an effect on the degree of competition in the industry and influence the business product or service pricing decisions. The company is now one of the world's largest retailers, with more than 6,800 locations across Europe and Asia. The fist chief executive officer was Dave Lewis. From my understanding there are many possible reasons that the government should consider while joining Euro, joining Euro would reduced exchange rate uncertainty for UK businesses and lower exchange rate transactions costs for both businesses and tourists. Tesco has over 4,000 stores across the world and out of those 4,000 Tesco has more than half of them in the UK around 2362 stores and this does not include all the Tesco metro and express stores. Though there are many companies operating chain retail shop . (http://www.tescoplc.com/plc/about_us/map/) Sainsbury which owns 16.3% of the UK supermarket shares and Morrisons which owns 11.5%, this means the entry barriers to entry are very high because the industry is dominated by small number of large firms which control and own that share market. European Union's rewards businesses and organisations, which reduce their CO2 emissions and penalises those that exceed limits. Twenty seven separate countries with widely differing economic performances and different languages have never before attempted to form a monetary union. A competition test to curb the power of the supermarkets was unveiled by the Competition Commission last year as part of a planning shake-up designed to boost competition in the multi-billion pound grocery market. If governments were obliged through a stability pact to keep to the Maastricht criteria for perpetuity, no matter what their individual economic circumstances dictate, some countries may find that they are unable to combat recession by loosening their fiscal stance. Under monopolistic competition, the market consists of many buyers and sellers who trade over a range of prices rather than a single market price. It was estimated that a traveller visiting all twelve member states of the (then) EC would lose 40% of the value of his money in transaction charges alone. It is estimated that the currency cost of exports to small companies is 10 times the cost to the multi-nationals, who offset sales against purchases and can command the best rates. Impact of European Unions Competition policy on Tesco European Union executes legislations in justice and home affairs, and maintains common policies on trade, agriculture, fisheries and regional development. Market Collapse: Tesco has stores in different countries but still it is completely depending on the UK market. It has been providing its customers with many different products in one place and with convenience. Tesco is simplifying its marketing structure under three teams in a move that will result in some redundancies at senior level as it looks to up its focus on the customer. Disclaimer: If you need a custom written term, thesis or research paper as well as an essay or dissertation sample, choosing Course Scholar - a relatively cheap custom writing service - is a great option. Thanks to our free revisions, there is no way for you to be unsatisfied. European Union is a unique economic and political society which is in partnership between 27 democratic European countries. Tesco PLC is a UK-based global supermarket chain and it has 7817 shops and 517,802 employees around the world. The article uses the SWOT Analysis technique to identify the market position of the company. Eliminating exchange rates between European countries eliminates the risks of unforeseen exchange rate revaluations or devaluation, further those businesses who involved in commercial transactions in different member states would no longer have to face administrative costs of accounting for the changes of currencies. The loss of national sovereignty is the most often mentioned reason for the UK not joining the monetary union is the transfer of money and financial proficiency from national to community level would mean that economically strong and stable countries would have to co-operate in the field of economic policy with other weaker countries. Noise, swimming water, rare species and emergency response -these are just some of the areas covered under the extensive body of environmental legislation that the EU has established over the decades. Understanding what structure a company operates in is key to successful market placement. OFT gathers intelligence about markets and trader behaviour from a wide range of sources and then they respond to complaints about markets from nominated consumer bodies, where the OFT is able to see potential problems, the OFT undertakes market studies and recommends to take action respectively. 1093 Words5 Pages. (http://www.oft.gov.uk/ about/what/#named2). They operate under a Monopoly because of their substantial market dominance and the high obstacles of entry within the retail food business. Tesco PLC is a British grocery and general merchandise retailer that operates internationally with headquarters in Hertfordshire, England. You have to be 100% sure of the quality of your product to give a money-back guarantee. The market structure is the setting in which the enterprise receives competitive 'discipline' or through which the rule of competition is made effective. An oligopoly is most likely to have a kinked . you to an academic expert within 3 minutes. The market share of of the leading supermarkets in Great Britain (GB) from January 2017 to December 2022 has remained fairly stable. Pure monopoly in where the firm is the industry, for example Transport for London, the firm which owns all buses and underground tubes in and around London, this is where consumers have no or very limited choice. In economics, market structure is a term that describes the state of a market, with respect to competition. Tesco PLC is the leading English distribution group. As Tesco manly sells general groceries they are affected by the European Union's environment policy, in a way that it has to source materials from the suppliers who obey and follow the European Union's environment policy, this means that Tesco has limited p of potential suppliers. This will unleash a greater potential for growth. But the tribunal agreed with Tesco that the commission did not fully take account of the fact that the test, relating to planning decisions for larger stores, might have adverse effects for consumers, among other matters. But, in economics, market is used in a wide perspective. The stability pact (the main points of which were agreed at the Dublin summit of European heads of state or government in December 1996) will force EU countries into a system of fiscal responsibility which will enhance the Euros international credibility. Get Your Custom Essay on. In this structure, multiple management systems operate to ensure that everything gets done with perfection. Tesco has to focus on labor costing now in order to have a sound financial condition. (Source: UK Jobs Dependent). Market structure influences the behavior of firms to a great extent. While the cohesion funds attempt to address this, there are still great differences across the EU in economic performance. The characteristics of perfect competition include: large number of buyers and sellers, easy entry to and exit from the market, homogeneous products, and the firm is the price taker. Leadership. Explore how the human body functions as one unit in Managerial Economics, 6th edition. Perfect competition describes a market structure where a large number of small firms compete against each other with homogeneous products. It works in the United States because the labour market is mobile, helped by the common language and portability of pensions etc. OFT plays a leading role in promoting and protecting consumer interests throughout the UK, while ensuring that businesses are fair and competitive. The European Commission has wide powers to make sure businesses and governments stick to EU rules on fair competition. Private goods on contrast are ones from which the public can only. Example of oligopolistic business industries are: supermarkets such as Tesco which alone owns 30.4% which is nearly 1/3 of the UK supermarket retail share market share, banking industry, chemicals industry, oil and energy industry, medical drugs and also the news and media broadcasting industry. 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