Industry’s Dominant Economic Features

&NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;92 -->&NewLine;<div class&equals;"quads-location quads-ad1" id&equals;"quads-ad1" style&equals;"float&colon;left&semi;margin&colon;0px 0px 0px 0&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;<p align&equals;"justify">Industry members must take into consideration the need and taste of final buyers as well as the middlemen&period; So&comma; basically organizations have to do a lot of periodic research in order to know the major shifts in buyers needs and requirements&period; They should also know the about the various factors factors affecting consumer behavior&period; <&sol;p>&NewLine;<h3>&&num;160&semi;<&sol;h3>&NewLine;<h3>Degree of product differentiation<&sol;h3>&NewLine;<p> &&num;160&semi;<&sol;p>&NewLine;<p align&equals;"justify">Product differentiation is another important factor for analyzing the overall industry situation&period; If all the products of industry are not fully differentiated then it will increase competition among the members of industry&period; In such case prices of the products will be low and the new entrants will find it difficult to compete with the existing firms&period; <&sol;p>&NewLine;<h3>&&num;160&semi;<&sol;h3>&NewLine;<h3>Product innovation<&sol;h3>&NewLine;<p align&equals;"justify">&&num;160&semi;<&sol;p>&NewLine;<p align&equals;"justify">Product innovation can be used as a measure to know the dominant industry features&period; If the industry is characterized by rapid product innovation and short product life cycle then the research and development is very important for the success of an organization&period; In such cases&comma; members of the industry must come up with new products to compete effectively&period; <&sol;p>&NewLine;<h3>&&num;160&semi;<&sol;h3>&NewLine;<h3>Pace of technological change<&sol;h3>&NewLine;<p> &&num;160&semi;<&sol;p>&NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;92 -->&NewLine;<div class&equals;"quads-location quads-ad2" id&equals;"quads-ad2" style&equals;"float&colon;none&semi;margin&colon;0px 0 0px 0&semi;text-align&colon;center&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;&NewLine;<p align&equals;"justify">If the industry is characterized by rapid pace of technological change then the art of the state technology is imperative for the success of organizations&period; For example Industry of mobile phones requires rapid changes in the technology in order to meet the changing consumer demands&period; <&sol;p>&NewLine;<h3>&&num;160&semi;<&sol;h3>&NewLine;<h3>Vertical integration<&sol;h3>&NewLine;<p align&equals;"justify">&&num;160&semi;<&sol;p>&NewLine;<p align&equals;"justify">It is important to know whether the competitors in the industry are partially or fully integrated&period; Similarly the competitive advantages and disadvantages of fully&comma; partially and non integrated firms should be taken into consideration&period; Vertical integration can cause potential cost of production differences&period;<&sol;p>&NewLine;<h3>&&num;160&semi;<&sol;h3>&NewLine;<h3>Economies of scale<&sol;h3>&NewLine;<p> &&num;160&semi;<&sol;p>&NewLine;<p align&equals;"justify">Organizations must also know about the different economies of scale in purchasing&comma; manufacturing&comma; and other activities&period; They should analyze whether the companies with high scale operations has any cost advantage or not&period;&&num;160&semi; Any reduction in the cost of production leads to higher competitiveness which ultimately results higher profits&period; &NewLine;<&excl;-- WP QUADS Content Ad Plugin v&period; 2&period;0&period;92 -->&NewLine;<div class&equals;"quads-location quads-ad3" id&equals;"quads-ad3" style&equals;"float&colon;none&semi;margin&colon;0px&semi;">&NewLine;&NewLine;<&sol;div>&NewLine;&NewLine;