Sei sulla pagina 1di 2

Introduction

Market structure was refer to the characteristic of the market either


organizational or competitive. There are four(4) types of market structure such
as Monopolistic Competition, Perfect Competition, Monopoly and Oligopoly.
Our team had decided to choose Monopolistic Competition the assignment
project regarding to the market structure of Gardenia Bakeries Sdn. Bhd. As our
subject for the assignment.

Monopolistic competiton is a type of imperfect competition that many producer


sells their product taht are can be differentiated from one another product based
on the quality and brand, also are not perfect substitutes. This market structure
has combines elements of monopoly and competitive markets. It was a freedom
of entry and exit, but firms can differentiate the products. It also have an
inelastic demand curve, so the firm can sets prices. Supernormal profits will
encourages more firms to enter the market leading to normal profits in long
term.

This kind of market structure has three(3) characteristics. First, A Large Number
of Firms, the number of the firms was not as many as perfect competitive firms.
It has three implications. Firstly, each firms has only a small market share and
therefore has limited market power to influence the price of its goods and
services. Secondly, each firm is sensitive to the average market price, but no one
firm’s actions directly affect the actionsof other firms. Thirdly, collusion or
conspiring to fix prices is impossible.

Second, Product Differentiation, as the firm produce product that are not
homogenous, but are slightly differentiated. Product differentiation is a strategy
that firms use to archieve market power. The firms have price inelastic demand,
there are the price maker because the goods is highly differentiated. Firms are
allocatively and productively in efficient.

Thirdly, easy Entry and Exit, as mentioned before, there freedom to the producer
because of the entry and exit from the market is relatively easy, even it was may
not be totally free for those action.

The Gardenia Bakeries (KL) Sdn. Bhd. Is a subsidiary of Singapore listed Food
Group, QAF Ltd. It also has associates withe Padi Beras Nasional Berhad. As
the founder of Gardenia, Mr. Horatio Sye Slocumm, he founded Gardenia in
1969 with his thirty five years baking experience. Gardenia Bakeries (KL) Sdn.
Bhd. Manufactured its first of bread in 1986. After that it become the bread
market leader within four short years in Malaysia. Through the production of
distinctive style bread, it had achieve tremendous growth and dominace. Based
on the past assigment by Kaising Teoh, Gardenia halso have 70% share of the
breade market in Malaysia, its consumers across the entire spectrum of
socioeconomic group.

Gardenia had been choosen as the assignment subject because of its market
structure was founded an adaption of monopolistic competition. Gardenia had
various type of bread product over 20 type, such as Classic White Bread, High
Fiber Whole Wheat Bread, Twiggies and more. Bread is the main product, so
the demand of the bread can be explained as the willingness and ability of
consumers to pay for the goods during a specific time. Gardnia was not aprice
competitor, and their bread was not the cheapest. Garrdenia has their own secret
recipes to bake their nutritive value, good taste and softness of the bread. It has
superior ingredients and high hygenic standarts to guide its production to be
well-known as the servers of the bread to its consumers.

The example of its competitor in bread production is Massimo, which has spring
out in 2011. The price of Massimo’s bread was cheaper than Gardenia’s bread.
As the Gardenia remains their production performance, their bread still got its
consumer without affected by the appearance of Massimo. As a result, the
delight consumers are still supporting the Gardenia Bakeries others than its
works of promoting the product.

In Cconclution, the Gardenia Bakeries was the suitable subject for being as the
assisgnment project because of its market structure. Its still be the popular
Malaysian favourite bread. It also still grow bigger, in future it might be the
leader of the bread production in the world. Its bread is also considered as at the
affordable as before. Hopefully this analysis of its market structure will be the
reference of peoples and help other to be more under standing about
Monopolistic Market Structure.

Potrebbero piacerti anche