The consumer market is a theoretically possible structure with competition, which does not have any restrictions or entry barriers. It is formed on the basis of several factors. The main one is consumer demand. The market combines all the processes and phenomena in the field of production with purchasing power. This is precisely the basis for its stable functioning.
Market Varieties
The modern consumer market is a rather complex structure, which is divided into several varieties:
- Competitive market. It is characterized by a huge number of different organizations and enterprises, each of which has a certain share, as well as products with weakly expressed differentiation. In addition, there are a large number of different options that combine elements of the market structure, that is, certain models with a slight difference from each other.
- Oligopoly. Such a market consists of many organizations that control most of the market.
- Duopoly. It represents an oligopoly, but only consisting of two enterprises.
- Oligopsony. A market of this type is characterized by the presence of many sellers and, at the same time, the complete absence of buyers.
- Monopoly. There is only one manufacturer of a product or service in such a market. The higher the degree of monopolization, the higher the chances of individual companies to optimally control the price situation.
- Natural monopoly. For this type of scale is characteristic, that is, the size of the company depends on the level of efficiency. The producer can be assigned the status of a natural monopoly when he is able to independently provide for the entire existing consumer market. This is precisely the main difference. He is not characterized by any combination of several small companies or manufacturers with a narrower specialization.
- Monopsony. This market is distinguished by the presence of only one buyer.
Consumer Market Formation
There are certain criteria that fully affect the development of the consumer market. What exactly moments form it? Here are the main ones:
- Market launch of products of small and medium enterprises.
- Losses are lost in subsidies.
- Removing pricing restrictions.
- Encouragement of enterprises that produce consumer goods (tax cuts, provision of soft loans).
- Making changes to the list of social goods.
- Enterprise development.
Service market
The consumer market for services includes the provision of various types of services, for example, transport, legal, repair, audit and others. This list consists of many items. Consider the main ones:
- public services - water, gas, electricity, etc .;
- informational - advertising, consultations, information;
- household - communication, transport, security.
It is worth noting that all services are provided for a fee, with the exception of warranty service.
Key Pricing Points
The essence of the market is an organized structure, including the manufacturer of a product or service, its consumer, seller and buyer. Their interaction contributes to the formation of prices. Such a structure is characterized by the following points:
- number and size of organizations;
- degree of similarity or difference of goods;
- Entrance and exit without any restrictions on the specialized market;
- readily available information and some others.
The degree of influence on price formation directly depends on the basic structure of the market component.
Consumer Market Infrastructure
There is also an infrastructure designed to facilitate trade, economic and legal control over this process, increase the efficiency and effectiveness of its implementation and to provide the necessary information. It can have a different configuration, which is mainly formed by the consumer market. The essence of infrastructure is the availability of private and state-owned enterprises, ensuring the proper execution of all market relations.
