Types of competition or market systems
A business goal of every company in the fashion industry is to earn a profit by providing products and/or services that are desired by the ultimate consumer. However, many companies are vying for the consumer’s business.
As such, fashion brand companies compete with one another for market share, the percentage of total volume (dollar or unit) a particular company or brand captures. Fashion brand companies are involved in one or more types or systems of competition and thus compete on the basis of factors related to these systems.
Five primary types of competition or market systems exist among companies in countries that adhere to market economies. In general, these systems are based on the number of sellers there are in a particular market.
All are briefly explained although not all are typical within the fashion industries:
- monopoly
- oligopoly
- oligopsony
- pure or perfect competition
- monopolistic competition.
The next step will take a deeper dive into the types of competition by elaborating on the five primary types we mentioned in this step.
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