What is the market structure of each industry?

                    The market structure of Pharmaceutical industry and Electronic Retails Industry could be considered as “perfect competition,” which is a theoretic market structure with the features such as; little obstacles to access, alike products which are not different one another, an unrestrained amount of manufacturers and customers, and also an impeccably flexible (linear) curve of demand. This could be seen from how every single company gets its price based on the industry, and it is also, accordingly, mentioned to as a price taker. The business is collected of the entire companies which are in the business, and the price in the market place is where the demand in the market place is equivalent to the supply in the market place. Every single company must have to control this price and will be unable to depart from it (Layton, Robinson, & Tucker, 2018).

What will be fixed and variable inputs for the new company to start and operate 

Due to I will open a new business in electronic retail industry which using both real store platform and also online shopping as well. Therefore, the fixed cost which will be included are:

Building rent

License

Salaries for employees

Phone and internet costs

Marketing costs

Vehicle for delivery costs

Unpredictable costs

 For the variable costs of my new company will be:

Sales Commissions

Inventory Purchased for re-sell

Packaging and Delivery Service

Incentive for the employees

Use a table to provide what will be the fixed and variable costs of the new company (if you don’t have real data, you can provide logical estimates) 

Fixed Costs Amount Variable Costs Amount

Building Rent $2,000 Sales Commissions $1,000 

License $1,000 Packaging and Delivery Service $500 

Salaries for employees $5,000 Incentive for the employees $1,000 

Phone and Internet $500  

Marketing $500  

Vehicle $2,000  

Product Inventory $200,000  

Total Amount $211,000 Total Amount $2,500 

Use a table to provide what will be the price of your products/services (explain why. Take into account that pricing strategy depends on market structure, for example, pricing of a firm in perfect competition is based on cost structure), what will be the expected number of sales, revenue and the profit.

For the price of the products that I will retail in my new business would be depend on the cost structure in the market place. For start, the prices for my products, expected sales, profit, and revenues will be explained from the table below.

Name of Products Price Expected sales Profit Revenue

Personal Computer (PC) $500 $800 $300 $800 

Digital Camera $100 $150 $50 $150 

Televisions $300 $500 $200 $500 

Mobile Phone $200 $300 $100 $300 

Total $1,100 $1,750 $650 $1,750 

How would you differentiate your products/services from those of competitors

I will differentiate the products that I will retail in my new business with considering some aspects such as:

Presenting attractive images along with exciting descriptions

Due to my business will be in retail electronic industry which provides real store as well as online shopping for the customers, therefore, I will make sure that the images of products in my official website will be attractive along with exciting descriptions which will motivate the customers to buy.

Provides free delivery service for certain distances

My new business will provide a free delivery service for the areas within the distances of max. 10km from my real store.

Offers various payment options

For my new business, I will offer various payment options such as Cash on Delivery (COD), credit card, and other payment methods so that the customers could choose which payment method that really suitable as their preferences.

Give an excellent customer service support

To give an excellent customer service support, I will include live chat in my official company website so that customers will able to contact and make their queries easily and comfortable as well.

Resource: https://www.revechat.com/blog/10-ways-to-differentiate-your-e-commerce-store-from-your-competition/

Conclusion of fixed and variable costs of the new company

            In my business plan to open a new company which will functioning in electronic retail industry, I have observed for the market structure in the United States and found out that the market structure there is appeared to be “perfect competition.”  For my upcoming business, I will functioning in two platform which are the real retail store, and also online store as well. For that, I have made the estimation for the fixed costs and variable costs for my new business. The fixed costs will included some estimations for Building rent, License, Salaries for employees, Phone and internet costs, Marketing costs, Vehicle for delivery costs, and also Unpredictable costs as well. In the other hand, the variable costs from my new business included for Sales Commissions, Inventory Purchased for re-sell, Packaging and Delivery Service, as well as Incentive for the employees. I also has figured out for the prices for my products, expected sales, profit, and revenues for my upcoming electronic retail business. To be survive in the industry, of course, we will need to make a great marketing strategy (Fifield, 2012). Therefore, I have planned to differentiate my products from other competitors in the market place. The methods that I will use to differentiate my products from other competitors in the market place are like presenting attractive images along with exciting descriptions, provides free delivery service for certain distances, offers various payment options, and also give an excellent customer service support. The reason behind it is that, with numbers of competitors in the industry, we have to be smart to make the customers prefer to buy our products rather than other products in the market place.

References of fixed and variable costs of the new company

Fifield, P. (2012). Marketing Strategy. Routledge.

Layton, A., Robinson, T., & Tucker, I. (2018). Economics for Today. Cengage AU.