Business Proposal
Brandy Vasquez
ECO/561
December 2nd, 2013
Joel Spina
Introduction
Finding a product that will last and offer a fair product for fair profit without a lot of competition is quite challenging. For this paper, the topic of focus is concrete and the need and costs for such a product. Currently, most buildings, structures, monuments, highways, bridges, and more are developed out of this remarkable material. This highly demanding substance is purchased by many different forms of customers like government or civilian companies, private homes, and more. Without concrete, the world wouldn’t have sidewalks, patios, statues, and other shrines that make our world what it is today.
This paper will identify the following:
* Market structure of the cement industry
* The elasticity of the product, and include rationale on how pricing relates to the elasticity of the product
* How changes in the quantity supplied results in pricing decisions that may affect marginal costs and revenue
* Non-pricing strategies to increase barriers to entry, and how business operations alter the mix or fixed variable costs in line with this strategy.
* Current global economic conditions and their effect on macroeconomic indicators for cement
* The local economy’s stage in the business cycle and current credit market conditions that affect that planning and operation of the cement industry.
Market Structure
According to “Cement Market Dynamics and Pricing” (2011), A market is defined as “the sum of all goods and services that are regarded as interchangeable or substitutable by the consumer,” (para. 1). Because cement is a unique substance, it tends to be considered the major material for concrete production. Although there are other sources and substitutions for the concrete product, cement is distinguished as a standardized mass product for concrete ("Cement Market Dynamics and Pricing", 2011).
Market Structure for concrete...