Industry: Economics and Distribution Channels Essay Example

The two kinds of industries that tend to be better performers in the medium to long term are the industries involving Brewery and Computer Systems. The Brewery industry tends to have negative total returns in the short term and then ultimately does better in the long run. The reason is due to the regulations in the beer industry, the various styles of beer choices provided by various breweries and demand from individuals, since beer tends to have a flat consumption and price rate (Hoovers.com, 2011). Furthermore, marketing is extremely important for the Brewery industry especially with respect to distribution channels, which is why it takes a longer time to gain returns in the industry. Michael Porter addresses the need to assess industries possible entrants as it pertains to competition. In the brewery industry, new entrants face several challenges especially with respect to legal fees and the distribution channels. Thus, the brewery industry does meet this requirement which makes them competitive. Additionally, the brewery industry has loyal customers which helps establish beer brands.

On the other hand two industries that tend to do poorly in the medium to long term are industries that involve Savings & Cooperative Banks and Independent Power Production (utilities). Savings and Cooperative Banks are affected by both the economy as well as customers demands. This has to do with the instability of the economy, as well as funds that are available to the public and the fact that their customers mainly own them. One of the disadvantages that are directly linked to Savings and cooperative banks doing poorly in the long run has to do with the various substitutes available to customers. The available substitutes determine the competition in the industry as stated by Porters Five force model.

Independent Power Production industry also does poorly in the long term due to it being privately owned and not linked to the government. The Power Production