Puregold: Economies Of Scale

Economies of scale Puregold is perhaps one of the companies that are benefiting from economies of scale, and for good reason. As a dominant player in retailing, the company's size provides it with enormous efficiencies that it uses to keep costs low. For example, its size allows Puregold to do its own purchasing more efficiently since it has roughly 250 large stores worldwide. This gives the company tremendous bargaining power with its suppliers. Not only does it get its products cheaper, but its size allows it more inexpensive distribution.
The retail industry is composed of very large retailers. These retailers are able to build brand loyalty and image for the existing players, thereby adding value to their company. Smaller entrants will