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Incumbent firm
Incumbent firms are businesses already established in each market or industry. They may have the advantages of having built up a loyal base of customers and also achieved internal economies of scale so that their average costs are lower than those of a rival / challenger supplier or brand.
Here are four examples of incumbent firms:
- Microsoft: Microsoft is an incumbent firm in the computer software industry, with a strong presence in operating systems, productivity software, and gaming.
- Coca-Cola: Coca-Cola is an incumbent firm in the beverage industry, with a strong presence in the production and distribution of soft drinks.
- IBM: IBM is an incumbent firm in the technology industry, with a strong presence in computer hardware, software, and consulting services.
- General Electric: General Electric is an incumbent firm in the industrial and manufacturing industry, with a strong presence in a variety of sectors including energy, aviation, healthcare, and transportation.
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Why is Coca Cola so profitable?
Study Notes
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Non-price competition - does it matter where beer is brewed?
16th December 2022
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Barriers to Entry (Quizlet Revision Activity)
Quizzes & Activities
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Incumbent firms
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