Marketing and Legal Frameworks: Barriers to Entry Analysis Report

This report analyzes the key barriers to entry into a new business market, focusing on the Australian market for a new personal financial management app. The report identifies and discusses two significant hindrances: government barriers and high startup costs. Government barriers include restrictions created by patents, copyrights, restrictive licensing, and limitations on market participants, with examples from the radio and airline industries. High startup costs involve infrastructure, machinery, workforce expenses, advertising, and brand recognition. The report references multiple sources to support its analysis of these barriers and their impact on market entry. The assignment was to create an A3 poster summarizing and visualizing the information. The report serves as a comprehensive overview of the challenges facing new entrants in the market.

Running head: MARKETING AND LEGAL FRAMEWORKS
MARKETING AND LEGAL FRAMEWORKS
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1MARKETING AND LEGAL FRAMEWORK
Barriers to entry into a new business market are considered as the obstacles that makes
things difficult in order to enter a new market. However, these are various hindrances that lies
here, however, the two most significant hindrances will be considered here.
Government barriers to entry: The government tends to act as a barrier towards the entrance
into a particular market which are being created by the patents and the copyrights. It is mainly
done through the requirement of the restrictive licensing or even by lessening the ability to
acquire the raw materials (Avgeropoulos, Stephanos, and John McGee 2015). The government
tends to erect various forms of barriers by simply providing limitation to the number of
participants in the market. However, it is to be noted that some legal restrictions for the for the
public utilities are being created to make the effective utilization of natural monopoly markets
that tends to create serious problems of inefficiency. The various number of businesses and the
individuals who are looking to start a new business in a particular form of sector are required to
carry their license or other forms of approval from the government in order to conduct the
business (Karakaya, Fahri, and Satyanarayana Parayitam 2013).The example of this is that if one
tends to start their own network of the radio, on researching it will be understood that there are
various number of hurdles that are being created by the government and various number of
expenses that needs to be attained and broadcasted for the wavelength of a particular radio. On
the other hand, it is to be noted that in case of the airlines, not only there is the stoutness of the
regulation but the government even lessens the new entrants in order to decrease the air traffic
and even to simplify the process of the monitoring (Lee et al., 2018). The cable companies are
highly controlled and even lessened because their infrastructure tends to require the public land.
On the other hand, various researches that have been conducted tends to indicat the fact that the
government applies various forms of barriers to entry the market not because of necessity but in

2MARKETING AND LEGAL FRAMEWORK
order to lob pressure from the firms which are already existing in the market business (Makhaya,
Gertrude, and Nicholas Nhundu 2015). Various critics are of the opinion that the regulations on
various industries are very much unessential, it tends to just accomplish nothing but limit the
competition.
Startup cost- high expense which are required in order to start up a firm can restrict various
firms to enter into the industry. The amount of money that is required to establish its
infrastructure, machinery, pay the workforce and all tends to serve as a barrier to entry into the
market (Zhu, Yining, and Randall 2017). The barrier that is being caused by the resource
ownership can be overcome by sustaining the expense of the exploration and acquiring various
types of resources (Ncube et al., 2016). On the other hand, the barrier that is being imposed by
the patients can also be overcome by conducting research technologically as well as through
development. The various types of restrictions that are being imposed by the government can be
overcome by providing the government officials with bribe (Roberts 2017). However, another
cost that is required for the startup tends to involve the advertising and the recognition of the
brand name. In order to compete with an industry which is already established, it is very
important for the new entrant to advertise its product or the service and reach an equal status
(Vellodi 2018). All these tends to require huge amount of money which tends to restrict the new
entrants from entering the market.

3MARKETING AND LEGAL FRAMEWORK
References
Avgeropoulos, Stephanos, and John McGee. "Barriers to entry and exit." Wiley Encyclopedia of
Management (2015): 1-3.
Karakaya, Fahri, and Satyanarayana Parayitam. "Barriers to entry and firm performance: a
proposed model and curvilinear relationships." Journal of Strategic Marketing 21, no. 1
(2013): 25-47.
Lee, Alice J., David D. Loschelder, Martin Schweinsberg, Malia F. Mason, and Adam D.
Galinsky. "Too precise to pursue: How precise first offers create barriers-to-entry in
negotiations and markets." Organizational Behavior and Human Decision Processes 148
(2018): 87-100.
Makhaya, Gertrude, and Nicholas Nhundu. "Competition, barriers to entry and inclusive growth-
Capitec case study." (2015).
Ncube, Phumzile, Maria Nkhonjera, Tamara Paremoer, and Tatenda Zengeni. "Competition,
barriers to entry and inclusive growth: Agro-processing." (2016).
Roberts, Simon. "Barriers to entry and implications for competition policy." Competition Policy
for the New Era: Insights from the BRICS Countries 1 (2017): 199.
Vellodi, Nikhil. "Ratings design and barriers to entry." Available at SSRN 3267061 (2018).
Zhu, Yining, and Randall A. Berry. "Contracts as entry barriers for unlicensed spectrum."
In 2017 IEEE Conference on Computer Communications Workshops (INFOCOM
WKSHPS), pp. 832-838. IEEE, 2017.