Question

what is fragmented industry ? what are fragmenting strategy ? what are the characteristic of a fragmented industry?

Answer 1

An industry with a large number of players and not even a single player will have the ability to influence others and take the industry in a specific direction.

The some of the fragmenting strategies are:

• Building a multi-sided business platform that can help in meeting the unmet demands and also help in resource allocation.
• Create a first mover strategy in order to gain as market share as possible and also to retain the customers.
• Creating a market research strategy to identify the trends before anyone and gain the competitive advantage.
• The company can go for chaining strategy where they build a good chain of suppliers and customers in order to retain the market domination.
• They can also follow pricing strategy by cutting price and giving the product at an affordable price compared to the competition in the market.

The characteristics of a fragmented industry are:

• The entry barriers are very low
• Almost zero product innovation
• Need for standardization will not be there
• Local firms inspire more
• There are no real economies of scale