Final report

Industry Description

The clothing and clothing accessories is one of the most lucrative businesses in the States and the globe at large. This industry deals with cloth products and the other clothing accessories. People buy cloths day in day out, it is therefore one of the main players in the global business performance. The products are very diverse and keep on changing with the changes in fashion. The nature of the products and the general economic principles are the key factors that determine the performance of the firms in this industry as well as the general economic performance that is contributed to by this industry. This industry has the manufacturers as well as those who do the retail business. The product includes children cloths, men women and people of all ages, it is quite clear that the fashion and dress code sometimes change with the age of the individuals (Huq, Chowdhury & Klassen, 2016).

Industry Market Structure

The clothing and clothing accessories industry is made up of many firms all over the globe. The characteristics of this industry portray the features of a perfect competition kind of a market structure. The first characteristic is the large number of buyers and sellers of the clothing products. The clothing industry has customers all across and is so diverse, considering the fact that clothing is a basic need, the buyers are therefore so many and that is the first part of this characteristic of the perfect competition market being portrayed in the clothing industry. These people are quite aware of the trends and keep updated about the fashion changes in the market. The industry has some many sellers of the goods and services. The clothing industry has so many firms all over the world in any geographical location. The demand so these products is very high considering the fact that the products are considered to be basic and so people have to ensure that they acquire the products. So the first characteristic is that of many small buyers and seller of the goods and services in the market.

The other characteristic that makes the industry be categorized successfully as belonging to the perfect competition market is the homogeneity of the products. The clothing products are just similar globally, they are manufactured in almost similar industry and that is why the homogeneity of the clothing products. So considering the two characteristics, the clothing industry can be categorized o belong to the perfect competition market structure.

Microeconomic Relationships

The demand for these products in as much as they are basic products keeps on rising and changing with the general. Income of the consumers. People tend to be more willing to buy goods when they have more or rather excess cash. This behavior explains the microeconomic concept of demand and supply and states the manner the changes in the income of the consumer may affect the demand of a products. This relationship can actually be presented graphically one manner the income of the consumers of clothing products may affect the products consumption (Chen, Li & Meng, 2017).

Government and the Industry market prices

The government has variety of roles that have impact on the pricing of the clothing industry. The government may simply subsidize the clothing industry to ensure that whatever the firms offer in terms of price had already been subsidized and so the amount the customers pay is not way too high. The government is regulating prices that are being set by the firms that sell these products. Pricing policy by the government ensures that the consumers are not exploited.

References

Huq, F. A., Chowdhury, I. N., & Klassen, R. D. (2016). Social management capabilities of multinational buying firms and their emerging market suppliers: An exploratory study of the clothing industry. Journal of Operations Management, 46, 19-37.

Chen, F., Li, F., & Meng, Q. (2017). Integration and autonomy in Chinese technology-sourcing cross-border M&As: from the perspective of resource similarity and resource complementarity. Technology Analysis & Strategic Management, 29(9), 1002-1014.