1 How would you classify the office superstore industry Who

1. How would you classify the office superstore industry? Who are the competitors? What are the characteristics of this industry that lead to this conclusion?

Solution

I would classify the office superstore industry as an Oligopolistic market.

There are 3 main competitors: Office Depot, Staples & Office max (in the US), in order of number of stores & total sales (and average sales per store).

Characteristics of this industry that leads to my conclusion are:

(1) There are very few large firms dominating the market (in this case, there are 3 large firms).

(2) Each firm can set its own price.

(3) Firm price & output decisions are interdependent.

(4) Entry to the market is not free & some form of entry barriers exist.

(5) The market is highly concentrated.