Market Opputunities
It is very hard to enter the industry as it is an oligopoly competition market. The large firms in the market includes woolworths and coles, dominating around 72 percent of market share. The middle scale firms such as aldi and iga has a market percentage of 20 percent. The small scaled firms in the industry only has 8 percent of market share. In this situation, the small scaled firms have very little market power and competition has been dominated. It is very hard to survive in the industry as the large firms has more capital and resources for competition.
Woolworths is the only grocery distributor in Tasmania, running the other small firms out of the market. A small firm providing the same good will be unable to have a price setting power as it has little capital. As woolworths has the price control, small firms would be affected or even suffer from lost if it decrease prices of goods.
The market is saturated and small firms without the ability to survive price fluctuates would be forced to withdraw from the market.
Woolworths is the only grocery distributor in Tasmania, running the other small firms out of the market. A small firm providing the same good will be unable to have a price setting power as it has little capital. As woolworths has the price control, small firms would be affected or even suffer from lost if it decrease prices of goods.
The market is saturated and small firms without the ability to survive price fluctuates would be forced to withdraw from the market.