1. When two or more sellers or producers struggle to achieve the same segment or establish the market, then competition rises in the market. Competition occurs when any producer or seller tries to sell similar product or service with the motive of achieving profit and capturing the market share. The competition comes together with innovation that brings the new displacing technologies in the market (Arnold, 2010). This is called the competition for the market. On the other side, competition in the market refers to the set of actions of the new entrants in the market that focuses on gaining the market share in the market that is already established (Arnold, 2010). When there are several firms competing for the same customer in the already existed market, then it is call the competition for the market while if the new firm enters into the market to compete and capture the market of already existing firm, then it is competition in the market.
Competition is very important whether it is the competition in or for the market and it affects the company’s decision. The competitive market compels the company to be efficient in terms of its operation and cost saving. If they fail to do so, then they will have to lose the market. The quality of the products and services must always be held high while the company must make decision to use its promotional techniques that will be inline with the company’s overall strategy. The level and nature of competition will be the deciding factor in determining the promotional strategies of the company (Arnold, 2010).
2. Open standards provide people to share the data and information freely with perfect reliability. It prevents the barriers created artificially and enhances interoperability. The development of open standards is based on the consensus and collaborative efforts and has strong impact on the market development. Since this facilitates the exchange of the data as well as enhances the interoperability of the goods and services, it boosts out the market development. So, many organizations are adopting open standards. There are various elements that are associated with the open standards such as due process, collaborative process, public availability, intellectual property rights, and quality as well as detail of the data.
The elements of open standard ensures that there is no one single dominating interest group while the collaborative process fosters the consensus among the market participants. The due process focuses on the response and the consideration to the market comments made by the market participants. The quality and the detail of the data are very important for the healthy growth of the competition as well as for the interoperability of the goods and services (Arnold, 2010).
On the bright side of open standards, it enhances the interoperability as well as maximizes the resources and goods accessibility. It ensures that the accessibility is not dependent on the single application or is restricted to a single particular platform. For example, Microsoft Excel can be used by several businesses. On the darker side, its general format might not meet the specific requirement of the businesses. The general format must be customized as per the requirement to share the data and information.
3. Price discrimination refers to differentiating the price according to the characteristic of the customer. Price of same commodity might differ from one customer to another, or from one period to another. Price discrimination can be done at first degree, second degree or third degree level (Mankiw, 2009). First-degree price discrimination occurs when the price of the commodity differs for each consumed unit. This gives an opportunity to the firm to capture the full consumer surplus. When the prices differ for different quantities of the goods, then it is said to be second-degree price discrimination. For example, the price differs when buying a single unit of commodity and buying large volume. Third degree price discrimination occurs when different price is charged to different customer group (Mankiw, 2009). For example, the fee for children and adult might differ in the fun park. The price discrimination will only be effective if the firm is operating in the imperfect market. In addition to this, the firm must be price taker where the demand curves slopes downward (Mankiw, 2009). Apart from these conditions, the firm must have capacity to prevent the resale as well as have capacity to separate the market. There must be well-separated market for the price discrimination to be effective.
4. The development of ecommerce has posed the challenges to the tax administration. The issue whether the tax must be applied to ecommerce is a hot debate topic. However, like any other business, ecommerce must be taxed because if it is not done so, then it will be unfair for other brick-and-mortar business and provides unfair advantage to ecommerce business. This will eventually be reflected on the cheap priced products on ecommerce sites as the sales becomes non-taxed transaction.
The ecommerce transaction forms the multi-billion dollar transactions. The growth of ecommerce business is very fast and their sales are also huge. So, tax liability of such company will be substantial. So, when such business is taxed, then it will have positive impact on the revenue of the government. As the technology and ecommerce advances, very big portion of sales from the brick-and-mortar business will be captured by the ecommerce sites. The sales from these sites would otherwise be made from the physical stores. So, if the ecommerce is not taxed, then it is like giving opportunity for businesses to shut down their physical locations and start virtual stores over the Internet (Prasch, 2008). This will virtually cause the problem in the revenues of the government. In such condition, the government will have to find out other source of revenue.
5. The supply chain strategy in the past was only limited in making tradeoff among the speed, assets, service level, as well as the cost. Later, this tradeoff was not only important but the main importance was on incorporating this into the operations to enhance the performance of the company. In the past, the business focused less on the overall performance and efficiency in the business through supply chain because supply chain management was considered as separate business process. This resulted in cost increment because of improper integration of the processes. But, with the development of the business theories and principles, the supply chain management is seen as one of the main component of business process and hence it is not seen in isolation. The supply chain of the business must be integrated to the company’s business strategy to get the best results and success. Apart from that, the supply chain must be flexible enough to adapt to the changing business environment (Fisher, 2007). The supply chain management must articulate the strategic intent and support the company’s business and corporate strategy. This process will help the company o identify the core suppliers and customers of the business, as well as identify other critical participants of the supply chain ecosystem. In the adaptive supply chain, it is very important to review and determine the ways by which adaptive supply chain reinforces and supports the company’s competitive advantage.
References
Arnold, R. A. (2010). Economics. Australia: South-Western Cengage Learning.
Fisher, B. (2007). The supply and demand paradox: A treatise on economics. North Charleston, S.C: Book Surge.
Mankiw, N. G. (2009). Principles of economics. Mason, OH: South-Western Cengage Learning.
Prasch, R. E. (2008). How markets work: Supply, demand and the 'real world'. Cheltenham, UK: Edward Elgar.
