Building a company that drives its sales, productivity, and profitability using a monopoly takes a whole lot of strategy application. Monopoly simply means market dominance. Many companies fight to gain a monopoly, especially in very competitive markets.
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Leading companies often thrive by strengthening their foothold over a market using monopolistic formula. Monopoly is the situation where an organization can regulate the price of products & services by creating various entry barriers for other players to cut the competition.
In this article, I highlight five ways to build a monopoly around your business.
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Protect Your Intellectual Property
If you have invented a solution, let’s say in the tech industry to uncover a solution, ensure you meet the regulatory bodies to protect your intellectual property. Ensure to get the exclusive legal rights to manufacture and sell a certain solution. By doing this, you have created a barrier that will hinder competition.
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Build A Strong Distributor Network
Another way to create a monopoly around your company is to build a strong distribution channel. The way to go about it is by engaging in long-term partnerships with associates that control the retail sector, by providing them with marginal value.
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Economies Of Scale
Another strategy for creating a monopoly for your business is by selling your products in large volume at a lower margin. To sustain market dominance, you must adopt what monopoly companies usually do. For example, you can generally enhance the scale of business which causes a reduction in average cost per unit. This economies of scale strategy discourage competitors to enter the market.
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Create Solutions With Unique Technology
To build a monopoly around your business, you must produce solutions that differentiate yours from theirs. Build a company solution and even means of customer service that will serve as a marker for you in the business world. Make a product that is difficult to replicate. This is another form of licensing strategy which allows businesses to create customer loyalty.
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Invest In Radical Brand Equity
Good branding is like having a good name. And it is famously opined that a good name is better than money. As a company that desires a monopoly, investing in branding is non-negotiable. There are various methods of doing this, which include positioning your company as a category king.
Featured Image Source: Entrepreneur
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This article was first published on 6th January 2022
nnaemeka-emmanuel
Nnaemeka is an academic scholar with a degree in History and International Studies from the University of Nigeria, Nsukka. He is also a creative writer, content creator, storyteller, and social analyst.
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