In the News

Monopolistic Competition - Prezzo to close one third of their stores

Graham Watson

24th April 2023

Restaurant chain Prezzo is closing 46 stores as it grapples with cost increases brought about by the current economic environment. It seems that the cost of living is starting to bite in the hospitality sector, and this might have further ramifications for the High Street.

It's also worth thinking about how the market structure of the sector will have contributed to this: Prezzo operates in a monopolistically competitive market, and, in all likelihood this means that they've probably got small profit margins. As a result, significant price increases will be particularly troublesome.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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