Samsung's Market Structure: Analysis, Implications & Interventions

This report provides an analysis of Samsung's market structure within the framework of management economics. It begins by describing Samsung as a South Korean multinational company with a diverse range of businesses, tracing its origins from a trading firm to a global leader in electronics and technology. The report analyzes the market in which Samsung operates, discussing different market structures such as perfect competition, monopoly, and oligopoly, and argues that Samsung primarily functions within an oligopolistic market. It explores Samsung's historical progression through different market structures, from initial operations in a perfectly competitive market to its current position in an oligopoly. The report also offers suggestions for Samsung's potential operation in different market structures and considers the role of government interventions, emphasizing the importance of innovation and brand value. The report concludes that Samsung should maintain its position in the oligopoly market to best utilize its resources and sustain long-term growth, while also adhering to government regulations and policies.

Management
Economics
(Assessment-2)

Table of Contents
INTRODUCTION ..........................................................................................................................3
Describe the company............................................................................................................3
Analyse the market.................................................................................................................4
Different market structure......................................................................................................5
Suggestions for the company to run in a different market structure and the government
interventions...........................................................................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Economics can be defined as the study of micro and macro factors that are majorly
affecting the profitability and growth of the company for accessing the further development in
the economy. Management economics is refers aspects which focuses on solving various issues
and taking appropriate decisions and for this various theories is being used in order to understand
the business environment(Ulucak and et. al., 2020). Demand & supply are considered as the two
wheel that ensures the flow rate of goods & services in the market. There is huge impact of
demand and supply on the overall sale of the company but law of demand is not applicable in the
case of luxury goods. This report is based on the Samsung company, it is the company in South
Korea with the headquarter in Samsung Town Seoul. This is basically comprises of various
businesses. The company is founded in 1938 by Lee Byung-chul. This report comprises the
description & products and services of the company. This also evaluates the company's market
structure & their characteristics. This also suggests the interventions of the government whether
the product for the general public.
Describe the company
Samsung is the international South Korean company which is headquartered in Seoul's
Samsung city. It is the largest chaebol, consisting of numerous monitor processes that is
integrated with the Samsung brand. They have launched their trade firm in 1938 and in initial
time, they have opened in the computer firm which is in the late 1960s but they are taking
strategic plan in order to effectively reach to their desired objectives and goals. The company is
one of the most properly names in the telecommunication industry. They are operating their
business on international level and also launching their smartphone which is compatible to other
leading brands.
As the owner of the company is basically dealing in the textiles, insurance, securities and
retail sectors. Further they have entered in the electronics industry and the construction of
shipbuilding industries. It is notable that the Samsung industries includes the Samsung
Electronics which is the world's largest information technology organisation, chipmaker and the
consumer electronics industries.

Analyse the market
Market is the place where the buyer and the seller are selling and purchasing their goods
in order to exchange their products and services with the proper exchange of money. There are
various type of market structure in with different companies are operating their business and are
being differentiated on the basis of their quality of products, type of goods offered and the level
of investment. This is the market where the large number of seller are understanding their needs
in order to satisfy them (Massa, 2021). A big landowning family in the Uiryeong country and
they have moved to nearby Daegu city & founded Mitsuboshi trading company. Samsung started
as the tiny venture with 40 employees that is located in Su-dong. They are initially dealing in
Dried-fish, locally grower groceries then they further move to the head office Seuol in 1947. But
during the Korean War broke out, they are constrained to leave Soeul then the founder have
started their business as sugar refinery in Busan and they further diversified into many different
areas.
They have further segmented their market by offering various type smartphone that can
be affordable to large number of buyers and by this they can rightly increases their revenue and
profitability. They are further operating their business by competing four largest companies in
order to reach to its emissions. They have positioned their market as the premium smartphones
which is basically owned by the people who is having sufficient buying capacity.
Various type of market structure
Market structure refers to the various sector or the industries that are being divided on the
basis of their nature and the degree of competitors & their activity that is directly influencing the
particular marketplace. There are various type of market structure that are explained as follows:
 Perfect competition: This is the type of market where big number of buyer and seller are
operating their business and no control over its competitors and their choices. They are
majorly offering homogeneity in their products and the prices is the single factors. These
are the factors which is having between choices between various products according to
their needs and requirement backed with the sufficient purchasing power and they can
effectively have the better products in the competitive market. This also helps offering
better products to the large group of customers. This is leading to have the better choices
and the preferences of the customers.

 Monopoly: This is the type of market in which single firm is running the entire industry
by offering unique products and they face no competition as the buyer do not have choice
due to single firm operating in the market. These are the prices makes who set their prices
as per their wish only & also have huge barrier in the entry of the brand-new firms. They
are offering do their prices favouritism as they can charge any prices to the different
segment of the customer in the large marketplace.
 Oligopoly:This is the type of market in which is commonly controlled by the small
number of suppliers as they have large number of few firms and also having huge
obstruction in the entry of the new venture who are planning to having interdependency
as the competitive firms is having lower the prices the the other firms also change its
prices as well by having the better approach in the market. Samsung is operating their
business in this type of market structure and also offering high quality of smartphones
having major dependency on their competitive firms.
Different market structure
In the initial time, the oragnisation is conducting their business activities in different
industries such as food industries with the help of locally grown groceries and the noodles and
also move to the different areas. Such as the leader in a insurance and retail industry. At the time,
they have started their business and faced huge competition in the market which is having the
greater impact of the overall profitability. In this scenario, they are operating their business in
perfect competition market due to the big number of buyer and seller which is increasing the
competitive edges for the company as well. But due to the increase of time, they have rightly
increased the basis of the business by getting innovative and new techniques and offer unique
products to their potential customer and gradually they are directing their business in the
oligopoly market place as there are small number of big firms who are running heir business in
the large market who are offering differentiate products. Also having few player in the market
and for that they are operating their business and fixing their prices as they are dependent on
each other.
In the past time, they are directing their business in perfect competition market due to big
number of buyer and seller who are operating their business and offering premium quality
smartphones but there are many competitors such as Apple, Motorola who are offering different
products in the large market. A perfect competition market is defined as the place in which

consumer & the seller is having full knowledge of the market. They further offer homogeneous
products and also having various characteristics of this market structure which is as below:
 Large number of buyer and seller: This is the main concept of this type of market as
they are having ample number of buyer and seller and also having no control over the
prices of the goods and the overall production of the company. In this type of market, the
seller is like the drop of water in the large ocean by which every business is operating by
getting advanced and unique technology. Every firm is centring on offering unique
products in order to meet the demand of the potential customers.
 Homogeneity of the product: These are the goods which are identical to other goods
and can be easily substitute by other firms(Akbulut and Adaman, 2020). consumer can
not analyse the actual and real fluctuation in the product offered by the certain
organisations. In this aspects, price is the major factor which influenced choices between
the various homogeneous product that are available in the large market. Previously. there
are many other firms who is competing in the large market and also having the grater
consideration by which they are operating their business and there are many other
competitive firms of Ferrari and they are having premium quality of goods by which they
can satisfy the needs of their customer at larger segment.
 Free Entry and Exit of firms: In this type of marketplace, there no such limitation in
the entry & exit of the firm as they are in the state the higher profit. They can rightly stay
in the market if there are having sufficient investment by which they can generate higher
profits and growths in various locations. Whereas, if the firms is facing any difficulty
while operating their business so that they can rightly withdraw their business from the
market with facing much of legal formalities. This motives many other firms to have new
businessperson to enter in the marketplace by which they can rightly have more income
and profitability in the larger marketplace.
 Perfect mobility of the factors of production and goods: This is the factors which is
related to the higher profit & the growth of the organisation by having the easy
accessibility of goods and several factors that are majorly impacting the overall
production of goods and services. There must be effortless follow the people from the
various organisations as they are free to move to other organisation where they are
acquiring higher salary & change the organisation as per their choices so that they can

increase their living standards. Thus, attribute make more skilled firms as the
businessman can rightly hire the person who is having effective purchasing capacity.
Suggestions for the company to run in a different market structure and the government
interventions.
When the organisation is conducting their business in oligopoly market as they are
offering the huge competition as well so they they must act in the same marketplace as they are
offer valuable products that is also giving the feel or courage of pride to the owner. As the firms
is already having big operating cost so they need more investment to change their market
structure such as monopoly then they need to take the permission of the government by which in
order to get free from the barrier of entry and exit and they need to be the single firms who is
selling smart mobile phones. If they want to enter in the perfect competition then they have to
offer the innovative products by which they can meet the demand of the potential consumers in
the target marketplace.
As per this, they can not act in various type of marketplace as they are having big brand
value and they are meeting the demand of their customer in the large market. Hence, the
organisation must stay in the oligopoly market that helps in making the best use of their
resources and also can sustain in the market for long period of time.
Government engagement are the various regulation or the legislation that is being
imposed for operating their business in different industries so that they can rightly use their
business in lawful manner. Government tries to solve the various market inequalities by applying
taxation and the subsidies. They also further set their own rules with the common approaches of
economics related to the fairness which also eliminates the price discrimination or the type f
market in which there is single seller offering prices at discriminated prices. This also helps the
firms to ensure the effective flow of goods and services in the large market which is also leading
to show the right direction to the supplier in an appropriate manner.
When thinking about the society, the government must imposed less takes irrespective
they are operative for the social welfare of the country by having certain policies & the plan for
the general people. Less intervention of the tax leads to give the proper salary and remuneration
to the employees and this can be done in the right direct by which they can have the effective
profitability and revenue as well. This also helps them to have the better living standard and they
are also enhancing the overall working of the employees.

CONCLUSION
This is resulted from the above report that macroeconomics is the aspects which survey
the market as they understand that there are various external factors which isstriking the overall
practicality of the business. There are various type of market structure such as monopoly, perfect
competition and oligopoly market that is being followed by the company as per their type and
nature of the business. In previous time, they are operating their business in perfect competitive
due to the big number of buyer and seller who is having the complete knowledge of the
marketplace and there is no limitation in the entry and exit of the firms from the market as well.
With the help of innovation and the development, they are operating their business in oligopoly
market structure. Lastly, it is recommended to the organisation to stay in the same market place
as they are having good brand image in the marketplace and there must be no intervention of the
government by which the organisation will not able to follow the price discrimination over the
wages of the workers or the price of the goods.

REFERENCES
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