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Article
Publication date: 1 September 2002

Fahri Karakaya

This study examines the importance of 25 barriers to market entry in industrial markets. A survey of 93 firms indicates that majority of business executives consider cost…

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Abstract

This study examines the importance of 25 barriers to market entry in industrial markets. A survey of 93 firms indicates that majority of business executives consider cost advantages and capital requirements to enter markets as the two most important barriers to entry followed by incumbents having a superior production process, capital intensity of the market, and customer loyalty. The least important barriers perceived by the executives in the study are government licensing requirements, followed by heavy advertising. In addition, the study investigates the underlying dimensions of barriers to entry in industrial market through a factor analysis. The results indicate that there are four major underlying dimensions of entry barriers in industrial markets.

Details

Journal of Business & Industrial Marketing, vol. 17 no. 5
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 4 July 2022

Megan V. Teague

This study acts as a proof of concept to address how general, broadly applicable barriers to starting a business impact entry across various firm sizes.

Abstract

Purpose

This study acts as a proof of concept to address how general, broadly applicable barriers to starting a business impact entry across various firm sizes.

Design/methodology/approach

The following investigation uses barriers to entry data in Teague (2016) to explore the costs of government intervention within the United States for 2011.

Findings

Results from cross sectional regression analysis of business entry rates across nine different business size classifications on a composite barrier to entry variable yield two main findings: (1) increase in barriers to entry decrease business growth for most establishment sizes and (2) increase in barriers to entry for larger firms result in positive entry rates.

Originality/value

This study is the first exploration of general, broadly applicable barriers to entry measures and entry rates. Its preliminary findings suggest that barriers to entry encourage development of larger business sizes at the possible expense of smaller businesses. This result encourages further work into the interconnectedness of government and business.

Details

Journal of Entrepreneurship and Public Policy, vol. 11 no. 2/3
Type: Research Article
ISSN: 2045-2101

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Article
Publication date: 23 January 2009

Eun‐A Park

The purpose of this paper is to examine economic debates over the conception of barriers to entry and speculates which definitions can be applicable to the telecommunications

4172

Abstract

Purpose

The purpose of this paper is to examine economic debates over the conception of barriers to entry and speculates which definitions can be applicable to the telecommunications industry, more specifically, the residential broadband market. Also, it seeks to clarify the various industrial factors that could prevent or mar the success of entry into the residential telecommunications market and it also seeks to introduce an analytical framework that can be adopted for evaluating the barriers to entry.

Design/methodology/approach

The approach takes the form of a literature review.

Findings

It clarifies the various industrial factors that could prevent or mar the success of entry into the residential telecommunications market and introduces an analytical framework that can be adopted for evaluating the barriers to entry.

Originality/value

Although market entry barriers are crucial industrial factors that influence the market share and profit of firms already in the market, very little research has specifically examined barriers in the telecommunications and broadband industry.

Details

info, vol. 11 no. 1
Type: Research Article
ISSN: 1463-6697

Keywords

Content available
Article
Publication date: 2 December 2022

Colin O'Reilly

Cross-country studies have shown that higher costs to starting a business tend to reduce entrepreneurship (Chambers and Munemo, 2019) and that an unfavorable environment for…

Abstract

Purpose

Cross-country studies have shown that higher costs to starting a business tend to reduce entrepreneurship (Chambers and Munemo, 2019) and that an unfavorable environment for business can increase poverty and income inequality (Chambers et al., 2019a; Djankov et al., 2018). Building on the current literature, the authors test whether barriers to starting a business at the state and city level in the USA are associated with changes in entrepreneurship and income inequality.

Design/methodology/approach

Measures of entrepreneurship (establishment entry rate and exit rate) are regressed on measures of barriers to entry in a cross-section of 50 states as well as a cross-section of 73 cities in the USA. Further, the authors regress measures of income inequality on measures of barriers to entry using the same two cross-sections. State level data on barriers to entry are from Teague (2016), published in the Journal of Entrepreneurship and Public Policy. City level data on barriers to starting a business are from the Doing Business in North America (DBNA) dataset.

Findings

Results show that there is a negative and significant association between barriers to starting a business and the rate of firm exit. A standard deviation increase in barriers to entry is associated with a five percent decrease in the firm exit rate at the state level. The authors find only limited evidence that barriers to entry are associated with income inequality.

Originality/value

Despite a large volume of scholarship on how regulation and barriers to entry influence entrepreneurship, no study (to the authors’ knowledge) has investigated how general entry regulation affects the entry or exit rate of establishments at the state or municipal level in the USA.

Details

Journal of Entrepreneurship and Public Policy, vol. 11 no. 4
Type: Research Article
ISSN: 2045-2101

Keywords

Article
Publication date: 4 September 2009

Christopher Clark and Lesley White

Barriers to entry and entry deterrent strategies are widely discussed elements of the strategic literature and help define the attractiveness of an industry. The channel structure…

1915

Abstract

Purpose

Barriers to entry and entry deterrent strategies are widely discussed elements of the strategic literature and help define the attractiveness of an industry. The channel structure of the pharmaceutical industry, in part because of the level of regulation applicable to it, has the potential for idiosyncratic strategic behaviour. The purpose of this paper is to explore the applicability of traditional approaches to entry barriers and entry deterrence in the Australian retail pharmacy industry facing the threat of a major entry by examining the perceptions of incumbent retail pharmacists regarding the strength of potential barriers to entry into the industry, and their likely response to entry.

Design/methodology/approach

The paper uses both qualitative and quantitative methodology to categorise potential barriers to entry in terms of their perception by incumbent players. More than 20 in‐depth interviews are conducted with a range of stakeholders and 132 retail pharmacists completed questionnaires.

Findings

The paper suggests that this industry is relying on barriers which, while arguably effective, are outside the industry's control, and do not justify the apparent complacency among retail pharmacists.

Practical implications

This research is of significant managerial relevance since it demonstrates that the incumbents are unprepared for potentially devastating impacts if supermarkets or other new competitors were to enter the market.

Originality/value

The authors propose and utilise a novel framework for entry barrier analysis which includes the perceived locus of control for each entry barrier. The contribution of the paper is therefore in its treatment of the traditional arena of entry barriers and deterrence.

Details

International Journal of Pharmaceutical and Healthcare Marketing, vol. 3 no. 3
Type: Research Article
ISSN: 1750-6123

Keywords

Article
Publication date: 20 January 2022

Aastha Behl, K. Rajagopal, Pratima Sheorey and Ashish Mahendra

The alternative arrangements to traditional employment have become a promising area in the gig economy with the technological advancements dominating every work. The purpose of…

2358

Abstract

Purpose

The alternative arrangements to traditional employment have become a promising area in the gig economy with the technological advancements dominating every work. The purpose of this paper is to explore the barriers to the entry of gig workers in gig platforms pertaining to the food delivery sector. It proposes a framework using interpretive structural modelling (ISM) for which systematic literature review is done to extract the variables. This analysis helps to examine the relationship between the entry barriers to gig platforms. The study further proposes strategies to reduce the entry barriers in gig sector which would help to enhance productivity and generate employment opportunities.

Design/methodology/approach

The study uses interpretive structural model (ISM) to ascertain the relationship between various entry barriers of the gig workers to the gig platforms. It also validates the relationship and understand the reasons of their association along with MICMAC analysis. The model was designed by consulting the gig workers and the experts allied to food delivery gig platforms namely Zomato and Swiggy.

Findings

It was observed that high competition, longer login hours and late-night deliveries are the significant barriers with high driving power and low dependence power. Poor payment structures and strict terms and conditions for receiving the incentives are interdependent on each other and have moderate driving and dependence power. The expenses borne by the gig workers, such as Internet, fuel and vehicle maintenance expenses have high dependence power and low driving power. Hence, they are relatively less significant than other barriers.

Research limitations/implications

The study is confined to food delivery sector of India, without considering other important sectors of gig economy for generalizing the framework. As the study is based on forming an ISM framework through literature review only, it does not consider other research methods for analysing the entry barriers to the gig platforms.

Practical implications

The study attempts to dig out the low entry barriers for gig workers in food delivery platforms as there is a dearth of analysis of these factors. This study would weave them using ISM framework to help the gig platforms overcome these barriers at various levels, thus adding to the body of literature.

Originality/value

The study discusses the need for understanding relationship between the entry barriers in the form of ISM model to identify the dependent and driving factors of the same.

Details

Aslib Journal of Information Management, vol. 74 no. 5
Type: Research Article
ISSN: 2050-3806

Keywords

Article
Publication date: 16 January 2009

Anders Pehrsson

The purpose of this paper is to review previous research and to propose a model for the impact of barriers to entry on the market strategy of an entrant firm, where product/market…

12694

Abstract

Purpose

The purpose of this paper is to review previous research and to propose a model for the impact of barriers to entry on the market strategy of an entrant firm, where product/market scope and product differentiation are central strategy components. The paper asks, what is the impact of barriers on market strategies of entrants? Are early and late entrants affected in different ways?

Design/methodology/approach

A model and propositions are developed‐based on a review of previous research. The model applies the contingency perspective and company cases exemplify the model.

Findings

It is proposed that a firm that enters a market late and faces extensive barriers would choose a broader product/market scope and differentiate its products to a larger extent than an early entrant. It is also proposed that incumbents' market strategies indirectly affect the market strategy of an entrant firm as incumbents' market strategies interact with barriers, and the effects are due to entry timing.

Research limitations/implications

The study contributes theoretically as it extends current knowledge of the impact of barriers to entry on strategy. Management of entrant firms are advised to strive for a fit between barriers and market strategy and consider the propositions.

Originality/value

The model and the propositions concern barrier effects on two key components of the market strategy of an entrant firm: product/market scope and product differentiation. Another important value is that the model accounts for interactions between incumbent strategies and barriers to entry, and effects on the market strategy of an entrant firm.

Details

European Business Review, vol. 21 no. 1
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 15 March 2013

Changgyu Yang, Sang‐Gun Lee and Jaebeom Lee

Given the increasingly saturated information and communication technology (ICT) market and the intensification of competition among ICT firms, there is a need for a better…

2529

Abstract

Purpose

Given the increasingly saturated information and communication technology (ICT) market and the intensification of competition among ICT firms, there is a need for a better understanding of entry barriers in the ICT market. The purpose of this paper is to examine the overall characteristics of these entry barriers and identify firms' strategies for achieving market dominance.

Design/methodology/approach

The authors examined the overall characteristics of these entry barriers and identified firms' strategies for achieving market dominance by tracking the actual patterns of firms' ICT market entry based on the Bass diffusion model.

Findings

The results indicate that the saturation of the ICT market reduced entry barriers, which strengthened the imitation effect. In addition, entry barriers were lower for ICT firms than for non‐ICT ones. Furthermore, entry barriers were higher for the manufacturing sector than for the service sector, indicating that the innovation effect was stronger for the manufacturing sector than for the service sector, whereas the opposite was true for the imitation effect.

Originality/value

These results suggest that those firms that are planning to enter or are already in the ICT market should develop better strategies for gaining a competitive advantage.

Details

Industrial Management & Data Systems, vol. 113 no. 3
Type: Research Article
ISSN: 0263-5577

Keywords

Book part
Publication date: 9 November 2009

Magnus Lofstrom and Chunbei Wang

This paper analyzes causes of the low self-employment rate among Mexican-Americans by studying self-employment entry and exits utilizing panel data from the Survey of Income and…

Abstract

This paper analyzes causes of the low self-employment rate among Mexican-Americans by studying self-employment entry and exits utilizing panel data from the Survey of Income and Program Participation (SIPP). Our results indicate that differences in education and financial wealth are important factors in explaining differences in entrepreneurship across groups. Importantly, we analyze self-employment by recognizing heterogeneity in business ownership across industries and show that a classification of firms by human and financial capital intensiveness, or entry barriers, is effective in explaining differences in entrepreneurship across ethnic groups.

Details

Ethnicity and Labor Market Outcomes
Type: Book
ISBN: 978-1-84950-634-2

Article
Publication date: 6 January 2012

Milla Laisi, Miika Mäkitalo and Olli‐Pekka Hilmola

The purpose of this paper is to understand the main market entry barriers confronted by the new operators in liberalized railway freight market (Poland and Sweden), as well as to…

1044

Abstract

Purpose

The purpose of this paper is to understand the main market entry barriers confronted by the new operators in liberalized railway freight market (Poland and Sweden), as well as to analyze the inaugurating market of Finland.

Design/methodology/approach

Swedish and Polish markets were scrutinized utilizing qualitative case study, implemented through semi‐structured theme interviews. Among primary observations, numerous second‐hand sources were used to gain triangulation. Research was conducted during early 2009. The Finnish material was collected with Delphi technique‐based questionnaires in 2005.

Findings

The main findings support previous studies arguing that the main barriers to entry are rolling stock acquisition, needed investments and bureaucracy. In Sweden, companies were start‐ups established on the grounds of the incumbent. The Polish market obtained new operators via vertical integration with a significant competitive presence of a governmental operator. Inaugurating Finnish market is identified as a combination of these two. Therefore, it is easier to understand why new entrants are not operating in the Finnish market.

Originality/value

The research contributes novel, first‐hand data to the subject, which earlier have been studied mostly via second‐hand data and literature analyses.

Details

Baltic Journal of Management, vol. 7 no. 1
Type: Research Article
ISSN: 1746-5265

Keywords

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