Differentiating Between Market Structures
Jeffrey Henkel
ECO/365
December 8, 2014
Hubertus Puaha
Off-roading has become a favorite past time lately and one company that speaks volumes for the industry is Four Wheel Parts. They have cornered the market not only here in the United States but in the World. In order to minimize cost and maximize profit they have outsourced one of their sister companies to china to create competition with their rival companies by reducing labor cost. By doing so there were able to increase revenue by having reduced market prices. Many of the techniques they use are similar to companies in different markets and are the leading reason to why they have ...view middle of the document...
Four Wheel Parts will go above and beyond to make sure your buying experience is better than the rest. As other companies like Quadratic offer competitive pricing Four Wheel Parts offer incentives on a daily basis in the attempt to draw the customers to them rather than the competitor. Several of their products have labels on their websites and catalogs that state free shipping. For the average customer when thinking about making a big purchase one of the first thoughts is how much is this going to cost to ship. In this instance the customer will automatically know they are covered ("Transamerican Auto Parts", 2011)
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After the thought of the purchase they begin to think about the installation of the product and whom they want to have do the work. Fortunately for all of the Four Wheel Parts customers they have an in house mechanic in almost every state with in the United States and offer competitive prices for installation and knowing you are purchasing from one of the best in the industry give peace of mind that the installation will be second to none. For those that are doing the serious changes to their vehicle they will know that this operation will warrantee their work as other may not. Several of the other competitors don’t even offer the installation, but will find a mechanic in your area to do the necessary adjustments to your vehicle. If for some reason the experience wasn’t satisfying enough when your opinion has been voiced they are prompt to make the situation right and offer other incentives to make sure you will sleep well at night knowing your vehicle is being taken care of ("Transamerican Auto Parts", 2011)
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Due to the aggressive nature of this company and their strive to be number one they have set themselves apart from other competitors by controlling the market with competitive strategies and keeping cost to a minimum to control the market. Because of this they would be considered an oligopoly market structure. They have continued to do so by even purchasing another company by the same of Smittybilt, which excels in fabricating front and rear bumpers and a wide variety of fenders and body armor to protect your Jeep or truck form the elements. After determining the cost of material and establishing a relationship with the market in china they out sourced they manufacturing department to china to reduce the cost and be able to offer the same product to the world for a cheaper price. Not only are they the leading off road supplier for the United States but the world where these activities are common ("4wd Parts", 2014)
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There are several different sectors with in this company as some were mentioned before as there are sister companies to Four Wheel Part and Smittybilt is one of them that was outsourced to China. Within Four Wheel Parts organization there is their online support, local support and retail stores, and their human resource department that handle complaints and customer needs when...
