Essay On Oligopoly

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How Do Oligopolies affect the Beverage Industry? In order to answer the question “How Do Oligopolies effect the Beverage Industry?” we must first understand what an Oligopoly is. An Oligopoly is a market form in which a market or industry is dominated by a small number of sellers. An oligopoly is much like a monopoly, in which only one company exerts control over most of a market. In an oligopoly, there are at least two firms controlling the market. So what exactly does this mean? To put this into perspective an Industry, such as the Beverage Industry, is composed of various sellers. However there are two main companies that control the Industry, they are Pepsi Co. and The Coca-Cola Company. Although there are several other companies such as Dr. Pepper & Snapple Group the Pepsi Co. and The Coca-Cola Company predominantly control…show more content…
Examples such as Coca-Cola and Pepsi Co. who have been in the Industry for several decades and gained significant amounts of capital and revenue are able to control the market. By using various strategies such as pricing, advertisement and control of resources they are able to disaffirm other firms from either entering the market or attempting to expand within the market as well. Through control they are able to set market standards that current firms or potential firms cannot compete with and must either remain at the level they are currently at or depart from the market. In addition, since they are the dominant forces within the market they are able to diversify and reach unlimited amount of consumers and potential consumers. For example when you go out, whether it’s the bar, a restaurant, or sports complex the beverage of choice by these businesses are either Coca-Cola or Pepsi, even the choice of mixers for alcoholic beverages. Coca-Cola and Pepsi have been sharply competing against each other however they have created a healthy competition in order to keep market

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