Management Economics Assessment 2

This report analyzes Adidas' market analysis in different market structures, including monopolistic, perfect competition, and oligopoly. It suggests that the company should stay in the same market type and avoid government interventions. The report also provides suggestions for market structure changes.

Management
Economics
Assessment 2

Table of Contents
INTRODUCTION ..........................................................................................................................3
Describe the organisation.......................................................................................................3
Analyse the market.................................................................................................................4
Different market structure......................................................................................................7
Suggestions for the company operate in a different market structure and the government
interventions...........................................................................................................................9
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Economics is that branch of study that emphasis on the problem solving aspects & taking
better decisions by having appropriately understand the internal and external environment. In the
large market, there is huge choices of the customer which is emerging according to the time so
that they can ensure the better products for their use(Subedi and et. al., 2020). Demand & supply
are the two aspects of the economy that ensuring the flow of products and services in the large
marketplace. Economics helps in understanding the target market by which they can rightly
make the better choices of goods & services. For this respective report, Adidas is the chosen
company, It is the German company which is operating in manufacturing shoes, clothes &
accessories. As the company is founded by the Adolf Dassler in the year of 1949. this report will
study of the market and its inception which also defines the certain characteristics of different
market segments. Moreover, it will analyse the particular market segment in which they are
operating their business in the history. Lastly, it is further suggested to the organisation to have
right market structure & the certain government interventions which would be lesser or greater to
the general public public.
Describe the organisation.
Adidas is the multinational organisation which is operating their business in clothing,
sportswear and accessories. It is founded in Germany and headquarters is in Herzogenaurach and
operating their business across the world. This is the largest company in Europe which is
operating in sportswear. They are earning the revenue of 21.915 million euros and there are
57016 employees who are working in the different department of the company. They are
offering premium quality goods with the aim of retaining their loyal customers to their brand.
Th owner of Adidas has started their venture in their home town & afterwards joined by
elder brother Rudolf in 1924 because of their personal issues, they both have owned their own
venture & these are being known by the brand name Adidas & Puma. There are stripes mark is
the major identify of Adidas that is being used by the organisation in their cloths & shoes.
Furhter, they are operating their business in 10 different countries for say, Boston, MA, United
States, China, Netherlands, Hong Kong, Switzerland, Russian Federation, Panama and Dubai.
They are conducting their business through their official website.

The main reason for selecting the Branded shoes as Adidas is the well-known quality
shoes in the globe by this is easy to analyse the need & wants of the current market so that they
can take the effective actions which results in sustaining in the market for long period of time.
Analyse the market
Market is the place which is common to the seller and buyer for selling and purchasing
their goods & services with the sole aim of having higher profits. There are various market
structure that is being accessed by the business by which they can easily generate higher revenue
and profitability in the large market place. This can be easy for the Adidas to have the choose
their current market which can establish effective research of market in order to understand the
needs & wants of their target marketplace.
They have analysed more than 50% of the population among the age of 18-30 which are
majorly engaged in athletics & rest of the population is playing game such as volley ball, cricket
and football, rugby and many more. Other population out of which 20% of the individual
between the age of 30-40 are interested in footing, morning walk and remaining 10% of the
population in the age of 40-50 wearing shoes for keeping them fit by walking.
They are identified the people who are having different choices and making the best one
out of the various options by which they can established good brand image in the largemarket.
This also contributing to the welfare of the society and the growth in an effective manner.
Various type of market structure
As different market is operating their business in various market structure as per their size
of business, location, number of employees, type of goods offered in the marketplace. This also
leads to have the better fulfilment of the customer's demand by serving them better products. By
this, they can sustain in the target market for long period of time. There are various type of
market structure which are given below:
 Perfect competition market: this is the type of market in that large number of buyer &
seller is having integrated set of choices and there is huge competition as the market as
large numbers of operating. They are offering homogeneous products and all the firms
are the prices takes as they set the price according to the competitive firms which are
sustaining in the large marketplace. These firms are firms are working on their own
principles as the needs and wants of the target market hence there is no barrier for the

seller and buyer which is making better choices of the products that also can be based in
the purchasing power sand the mind set of the individual.
 Monopoly market: It is the type of market which sole seller is operating the whole
market and having huge price discrimination as they set the prices of goods and services
as per their choices and profits margins. Customer is not having any other alternative in
order to have the same product due to single firms operation in such industry. They are
offering unique products with no competition as they are having good approach to
sustaining the market for long period of time.

 Monopolistic market: It is more realistic market that is existing in the real world as
there are large umber of firms which are operating their business by having differentiate
products. They are offering similar products buy they having slight change in their
products as they is huge competition which is having wide approach to the larger market
segments (Kells, 2020). There are vast number of choices for fr purchasing the product
over another which is fulfilling their needs and wants in the large market. Adidas is
operating their venture in this type of market as there are other brands which is operating
such as Puma and Nike but there is slight difference in their products.
 Oligopoly market: It is the market structure in which few big firms are operating their
business that is commonly dominated by the small vendors. As there is large huge
barriers entry in comparison to the new start-ups ventures. These type of market is having
the interdependency on each other as the rivals firms reduces its prices then it leads to
impact the other firms so they also reduce the overall prices of their products.

Different market structure
In the past time,the company is owned by the Adolf Dassler and then joined by his
brother but due to the issues they are operating their own business that named as Puma and
Adidas but they both become competitors. Thus following perfect competition market sturucture.
There are large number of buyer & seller who are getting more competitive environment. With
the use of advance technology and innovation, there have made some of the changes so that they
can modified their offerings as per the needs and wants of the target market.
 Homogeneity of the product: It is the major consideration of the market in that the
companies is offering similar products in usage, nature and design. These type of product
easily substitute other products as these are giving same level of satisfaction to the large
number customers. These are the commodities which is easily replaced by the other
goods giving same level of satisfaction to the individual. In the initial time, Adidas facing
competition due to large number of buyer & seller offering premium quality commodities
than Adidas.
 Free Entry and Exit of firms: There are many firms which are operation their business
in such type of market so that the seller is having various options to establish their brand
in the target market. There is no barrier in the entry and exits as they can enter easily in
the market and also leave the industry when they are not sustaining in the market due to
huge competition or if they are not generating higher profits. This is the aspects which

influence the individual for having better approach in the market and serve them
properly.
 Large number of buyer & seller: It is the significant characteristics of this market
structure as there are large number of buyer & seller offering homogeneity in their
offerings. There is no single seller who is having full control over prices as the single
firms is like the drop of water in the ocean. Due to the emerging marketing conditions,
innovation and advancement bring more competition for the firms and they are focusing
in offering unique products which can serve the large customer base and be the market
leader.
 Perfect mobility of the factors of production & goods: This is the aspects in which is
consider the land, labour and machine and there is no restrictions on the certain
employment by which they can move to any organisation in which they are getting
effective working and compensation. Company can also hire the deserving candidates by
which they can have the higher profitability and revenue. These are the certain aspects by
which they can come to have higher level of profitability and revenue according to the
suitability and preferences.
 Perfect Knowledge of market: This is the main characteristics in which the seller &
buyer is having appropriate knowledge in which the seller have to take the better
decisions by which they open their stores or the certain type of commodities which can
leads to offer the high value and revenue(Alam And et. al., 2020). Whereas, large number
of buyer is having the knowledge of current trends and can have the appropriate products
which can full fill the demand and also take the full consideration while choosing the
certain products by analysing competition in the market.
 Independent relationship between buyers & sellers: There is large number of buyer &
seller who is having differentiated needs & wants which can be changed over a particular
period of time by which they can move to the specific brand. This also helps in attracting
the large group of customers by meeting their satisfaction level according to the current
market trends so that they can sustain in the market for long period of time. Individual
buyer is not bound to buy the specific goods ans they are related to the specific choices
by which they can have the decisions making accordingly..

Suggestions for the company operate in a different market structure & the government
interferences.
As the company is conducting their business in the monopolistic market structure in
which there are huge buyer & seller but they are offering differentiated gods by which the buyer
can make the right choice among the product and services so that they can have the better
product which can full fill their needs and wants in an appropriate manner. They company is
involving huge cost in their production and manufacturing so if they want to have some
modifications then they need huge investment which will affects the overall budget of the
company and the functionality if the company. Thus, they can not go in the monopoly market if
they want to go in the perfect competition by which they required some modifications by which
they can meet the integrated demand of the target market by meeting the satisfaction level of
customers.
After accessing the overall market, it is suggested to the organisation to not switch to the
other market segment due to their goods brand image and quality products being offered by
them. If they change their market structure, then it will leads to have the impact the overall
market value and organisation might face huge downfall in their overall profitability.
Government interventions are the certain rules & regulation that is being imposed by the
regulatory bodies so that they can effectively run their operations in an appropriate manner. They
are majorly emphasising on running their whole business operation in lawful manner by
removing the taxation and inequalities. They also set the general rules and the economic fairness
by which they can eliminate the discrimination of prices or monopoly market. This also must be
in favour to the society by which they can have the huge taxes in their products & services and
this could leads to imbalance in the budget of the person & face huge looses in their regular
budgets.
When taking the survey of the society, it is suggested to the company that there must be
few interventions of the government by which they can not change huge taxes or their products
or services from the general public by which they can easily run their functions in the well define
manner. Further, they have implemented certain campaigns which also contribute to the welfare
of the society as the whole.

CONCLUSION
This is concluded as per the report that macroeconomics is the significant as there is the
great influence of demand and supply which impact the overall profitability of the organisation.
There are various type of market structure such as perfect competition, monopoly market,
monopolistic market and oligopoly market that is common used by the various firms according
to their size, nature etc. they company is using the monopolistic market due to large number of
buyer and seller offering differentiated products. In the initial stage, they were operating their
business in perfect competition market but due to use of advance technological and innovation,
they have shifted to monopolistic market structure. Further, this is suggested to the venture that
they must stay in the same market type by which thy can sustain in the market for long period of
time and there must be no such interference of the government bodies due to which they can
reduce the taxations on their goods and services.

REFERENCES
Books and Journals
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finance and economics, and non-fiction book publishing: some personal
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Augustynczik, A.L.D. And et. al., 2020. Socially optimal forest management and biodiversity
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Kells, S., 2020. Impacts of COVID-19 on corporate governance and assurance, international
finance and economics, and non-fiction book publishing: some personal
reflections. Journal of Accounting & Organizational Change.