It can be concluded that UK has less exports to the non EU zone compared to the European market, in June 2010 total value of goods exported to Europe was 11.3Billion compared to the total value of goods exported to the international market which was 10.9Billion. (http://www.oft.gov.uk/ about/what/#named2) Each paper is composed from scratch, according to your instructions. Effective competition to provide goods and services cuts prices, raises quality and expands customer choice. 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. It is important to note that the structure below . Tesco focuses on attracting customers through its signature low prices strategy. The main objective is to find out the market position of Tesco in relation to the other competitors in the market. Cohen believed in the business model "stack 'em high, sell 'em low". Effective competition provides goods and services cuts prices, raises quality and expands customer choice, allows technological innovation. European Union policies ensure safer food and a greener environment, better living standards in poorer regions, joint action on crime and terror, cheaper telecoms and communication, millions of opportunities to study abroad and more. The two organisations I will be comparing and contrasting are Tesco and Sainsbury's which I believe belong to the Oligopoly market structure. Introduced in 2005, the scheme takes in about 12,000 factories and plants responsible for about half the EUs emissions of CO2. 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. Order your essay today and save 15% with the discount code ESSAYHELP, Don't use plagiarized sources. huge efforts will be done through their sales team, the main focus is the product availability. However, Tesco ranks second, following after Wal-Mart, in terms of net profits. In this type of competition the companies are forced to follow the competitive pricing strategy in order to survive in the industry, i.e. Tesco has already proven that they are committed towards being eco-friendly, Tesco Plc, the worlds No.4 retailer, plans to spend over 100 million pounds with British green technology companies over the coming year as it steps up its drive to halve carbon emissions by 2020.. 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. An end to internal currency instability and a reduction of external currency instability would enable exporters to project future markets with greater certainty. The disadvantages of a monopoly is that customer are exploited to high prices and potential supplies have limited choice for demand and this means that the consumers have less choice and again might have to pay higher prices than normal or the monopoly can even use very low price to push their competitors towards administration or bankruptcy. The Commission's extensive powers to investigate and halt violations of European Union competition rules are subject to legal review by the European Court of Justice. Agriculture Media Competition Consumers Education Contacting their NGOs (consumer associations, environmental pressure groups, etc.) It operates in twelve countries by 2005. This is the reverse of the position in 1990. European citizens have the freedom to live, work, study, and travel in any other EU country. The Commissions extensive powers to investigate and halt violations of European Union competition rules are subject to legal review by the European Court of Justice. It was founded by Jack Cohen in the East End of London in 1919. The OFT has a 5 step method of keeping a good eye on business and other organisations these 5 steps start with Analysis, Prioritisation, Prevention, Partnership and Evaluation, the details of all the steps are on their website under What we do. Our business in numbers. The changes will see Sharry Cramond take up a role as head of brand and . A Natural Monopoly Market Structure is the result of natural advantages like a strategic location or an . The company is now one of the world's largest retailers, with more than 6,800 locations across Europe and Asia. Businesses regularly have to make appeals against Commission decisions if it seems like a unfair deal. Market Share: According to Kantar, Tesco has 26.9% of the grocery market share in Great Britain. Tescos market structure described by the media is believed to be a monopoly, Tesco has also been through the legal proceedings to prove their innocence, Tesco has accused of being manipulative and gaining monopoly by building stores across towns and cities through the country and Europe but realistically Tesco is an oligopoly, although Tesco is the dominant supermarket it has fairly large competitors who also partly control the market. Tesco has increasingly looked overseas for growth with 1376 stores outside the UK; international sales of 11billion in . No customs tax is charged on goods that are sold or transported between member states. 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. 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. 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. The European Commission (representing the common EU interest). Not only is Tesco one of the most valuable brands in the . Thus, the supermarket industry in the UK could be described as an Oligopoly Market. The transfer of money and fiscal competencies from national to community level would mean economically strong and stable countries would have to co-operate in the field of economic policy with other, weaker, countries, which are more tolerant to higher inflation. 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. 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. A market is the area where buyers and sellers contact each other and exchange goods and services. Among these three major entities, Tesco is the market leader in terms of global sales and its total market share. A single currency would help that transaction pass smoothly. Some of the basic aims of the European Union are peace, prosperity and freedom for its 498 million citizens in a fairer, safer world. Now the focus is on putting policy into practice in to UKs market. As the companies are bound to follow market prices the only way the company can have advantage over its competitors is by reducing its operating costs and working at optimum level of efficiency (http://news.bbc.co.uk/1/hi/special_report/single_currency/25081.stm) In 2013, Tesco spent approximately 110 million on marketing efforts in traditional outlets. 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. Tesco management aims to reduce the cost of purchases and operational costs through and a set of other measures in order to pass the cost advantage to customer as the main brand value. Tesco is an oligopoly as it is one of the few dominant firms in the supermarket market. EU Exports. 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. Market structure is said to be the characteristics of the market. Tesco PLC organizational structure is decentralized, tall (hierarchical) and product-based. In 2015, Tesco's ad spend declined sharply to less than 80 million, marking a huge shift compared to just . Perfect competition describes a market structure where a large number of small firms compete against each other with homogeneous products. Perfect competition is a theoretical market structure. Sellers try to develop differentiate offers for different customer segments and, in addition to price, freely use branding advertising and personal selling to set their offers apart. 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. 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). Tesco was founded in the East End of London, London in 1919. Explore how the human body functions as one unit in The Business Model of Tesco. Under the new law, EU countries will have to reduce exposure to fine particles in urban areas by an average 20% by 2020. Patents promote innovation for inventors, which allow exclusive rights to do business for a specific duration. June 2010 showed a 15.5 per cent increase in exports compared to May 2010 and a 33.0 per cent increase in exports compared to June 2009. The European Union plans to reduce greenhouse gases at least 20% by 2020 (compared with 1990 levels), raise in renewable energy's share of the market to 20% and cut overall energy consumption by 20% (compared with projected trends). Over recent years Tesco has become the world's third largest retailer and holds a dominant position in the UK's grocery market with a turnover of 42.6Billion in 2007 (FAME). For example, De Beers is known to have a monopoly in the diamond industry. The trend continues in the same direction until the asset price records a lower low (LL). If a community or even an individual has an important point to show to the union they must do some of the following starting with: The EU has developed a single market system of laws which apply to all member states, and ensures the free movement of people, goods, services, and capital, including the elimination of passport controls by the Schengen Agreement between 26 European Union states which I have listed below. et al, 2008:298). Monopolistic Competition Market Structure: Unlike perfect . Today the main priorities are combating climate change, preserving biodiversity, and reducing health problems from pollution and marking sure that natural resources are being used more responsibly. Check out our terms and conditions if you prefer business talks to be laid out in official language. Net sales break down by activity as follows: - distribution in Central Europe (7%): operation, at the end of February 2022, of 537 stores located in the Czech Republic (185; of which 126 franchised), Hungary (198) and Slovakia (154; of which 15 franchised). The disadvantages of a monopoly is that customer are exploited to high prices and potential supplies have limited choice for demand and this means that the consumers have less choice and again might have to pay higher prices than normal or the monopoly can even use very low price to push their competitors towards administration or bankruptcy. 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. The final total value of UKs trade-in-goods exported for January 2009 to December 2009 was 101.5 billion. In another case, The Royal Bank of Scotland or RBS has also paid a fine of 28.59 million about 2 months ago in March 2010, after admitting breaches of competition law between October 2007 and February or March 2008, the fine for the bank was reduced from 33.6 million to 28.59 million and this was done to reflect RBSs admission and agreement to co-operate. Founded in 1919 by Jack Cohen, Tesco has emerged to become the biggest retailer in the UK and more than 80 million shopping trips are made to Tesco stores each week (Annual Report, 2015). The European Parliament (representing the people of Europe), The Council of the European Union (representing national governments). A multinational company like Tesco cannot merge with another giant if that would put them in a position to control the market, though practice this rule only prevents a small numbers of mergers going ahead. How does OFT checks anti-competition? In March 2015, UK consumers spent around 34 billion. Even in store level, there are as many as four layers of management in some large stores. 1 MARKET STRUCTURE Executive summary The purpose of this report is to analyse the market structure of two different competitive market structures of two different companies. My description will include an evaluation of the pros and cons of UK joining the Euro along with that I will describe the impact of 2 EU policies on UK businesses. aviation all airlines prove one service which is to get their customers from one location to their destination and most customers have no preference or specific type of airline that they want to travel with, most customers will just look for the cheapest airline. This penalty to the British Airways has been the highest ever imposed by the OFT for violation of competition law and this demonstrates the determination of the OFT to deal strongly with anti-competitive behaviour. Get expert help in mere Let us help you get a good grade on your paper. There may be a large number of firms, but most are small and relatively unimportant, while a small number of large firms produce most of the outputs of the . Did you know that we have over 70,000 essays on 3,000 topics in our 10 minutes with: Types of Market Structures and Competition in UK, Explore how the human body functions as one unit in harmony in order to life //= $post_title In the United States economy most markets can be classified into four different markets structures. This will unleash a greater potential for growth. Tesco themselves say that it is an oligopoly, this is because Tesco is not the only supermarket in the UK, Tesco is the dominant shareholder but cannot be called a monopoly as there are many other firms which are in competition with Tesco e.g. Market Collapse: Tesco has stores in different countries but still it is completely depending on the UK market. Under the European Union the members can travel and trade freely without any constraints as long as the members are trading in euro (the single European currency). 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. //= $post_title The Commission can, does and has fined companies for all these practices. The total 2010 year to date value of UKs trade-in-goods imported excluding June 2010 was 67.5 billion. The Tesco Plc Company is on fourth place in terms of total revenues within the United Kingdom market segment alone. In November 2007 Tesco one of the top three largest UK Supermarket chains and a major global retailer opened its first stores in the USA under the brand name 'Fresh & Easy'. essay, Quasar Computers and Different Market Structures, Various Market Structures and Characteristics, Reflection Essay on Differentiating Between Market Structures, Differentiating Between Market Structures, Classifications of market structures in the US, Analyze the Price Elasticity for different market structures, Write Perfect competition: This work is done using the powers granted to the OFT under consumer and competition legislation. Agriculture Media Competition Consumers Education, Employment Environment External trade Fight against fraud Human rights, Taxation Transport Justice, freedom Internal market Customs, Impact of European Union's Competition policy on Tesco. This may lead to pockets of deeply depressed areas in which people cannot find work and areas where the economy flourishes and wages increase. In the business model of Tesco, we have seen that it has organized its business model with the best strategies. Tesco PLC is a multinational grocery and general merchandise retailer. Most common examples of monopolistic competitions are: restaurants as in the right area and right type of food they can have their own small portion of monopoly, professional solicitors, building and project managing firms and finally plumbers as there are less of them and more required. The total equity consisted of the following items: 409M of share capital, 5 . 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