Assessment of Performance Measurement in - St Clements University

High product differentiation: If product differentiation is very high and
based on image, it can place limits on a firm’s size and provide and
umbrella that allows inefficient firm to survive, large size may be
inconsistent with an image of exclusivity or with the buyer’s desire to have
brand of all his or her own. Closely related to this situation is one in which
key suppliers to the industry value exclusivity or a particular image in the
channel for their products or services.
Local laws: Local laws and tax system in Kaduna have forced some firms to
comply with standards that are unique to the local political scene, leading
to major source of fragmentation in some industry, even where the other
conditions do not hold. Local legislations have probably been a contributing
factor to fragmentation in industries.
2.5 WAYS TO OVERCOME FRAGMENTATION
Overcoming fragmentation is predicted on changes that unlock, the
fundamental economic factors leading to the fragmented structures.
These approaches include:
1. Creating Economies of Scale:
Economies of scale are a means of overcoming industries fragmentation.
Technological changes leads to economics of scale, thus resulting to
industry consolidation. Economies of scale created in one part of the
business can sometimes outweigh diseconomies in another. Innovation
that creates economies of scale in marketing can also lead to industry
consolidation.
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