BUAD 307





Industry Balance

PowerPoint Narration

In a more balanced industry, different firms will attempt to serve the unique needs of different market segment.  Thus, competition becomes more a matter of best serving the needs of the segment rather than selling at the lowest price.  In an extreme case where there is little differentiation, the only remaining area where firms can compete is on price.  This results in price wars, driving down profits.  Both buyers and sellers are likely to be better off the each customer receives a product fitting its needs at a higher price than if they receive a less well suited product at a lower price.


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