Generally, people will buy the name brand cereals rather than trying the generic or store brand cereals. Today, numerous types and varieties of cereal line the grocery store shelves.
The cereal manufacturing industry consists of four different firms that control almost all of the market.
Typically, the companies aim their cereals at different segments of the population. These categories are perfect competition, monopolistic competition, oligopoly, and monopoly.
Each company produces many different brands of cereal. Post began cereal production in Battle Creek, Michigan Topher. In an oligopolistic market, entry barriers, which prohibit new firms from entering the industry, are present. An oligopoly consists of a small number of interdependent firms.
For example, Tony the Tiger, Toucan Sam, and the Trix rabbit are all cereal box cartoons and are very popular with children.
Examples of entry barriers include patents, brand loyalty and trademarks. However, this is not easy since an oligopoly has entry barriers. The demand curve of an oligopoly depends on how firms choose to deal with their interdependence with the other firms in the industry.
An oligopoly consists of either differentiated or homogenous products. The cereal industry produces differentiated products. An oligopoly produces either differentiated products or homogenous products.
InGeneral Mills and Kellogg led the industry with a market share of This vast industry stems from the late s when John Harvey Kellogg and C.
The main entry barrier for the cereal industry is brand loyalty. Most of the non-price competition in an oligopoly comes from product differentiation. A firm within an oligopoly market can choose to cooperate with other firms in the industry, which is illegal, or the firm can choose to compete against the other firms.
Each of these four categories has its own unique characteristics. Cereal is one of the most popular breakfast foods and some brand is found in almost every home in America Topher.
However, only a few select companies make every one of those different kinds of cereal. Another example of an entry barrier is technology Topher. Kraft Foods had a market share of The major companies in this industry are constantly developing new products, which makes it almost impossible for a new Firms trying to enter the market find it very difficult to compete against the kind of control that the top four companies have over this industry.
Long-run economic profits are possible for an oligopoly, and non-price competition is a significant way to compete with other firms in the same market. Perfect competition has an unlimited number of firms, while a monopoly has one single firm, and an oligopoly consists of a small number of interdependent firms.
These may consist of children, adults, and health conscious consumers Topher. The cereal manufacturing industry is an oligopolistic market because it exhibits many of these traits.
Since an oligopolistic market potentially makes an economic profit in the long run, firms want to enter the market. The Manufacturing Industry Everyday, more than eighty million Americans have some type of cereal for breakfast.
Another way that cereal companies differentiate their product is by pushing their cereal as a finger food Topher.Cereal: The Manufacturing Industry Everyday, more than eighty million Americans have some type of cereal for breakfast. Cereal is one of the most popular breakfast foods and some brand is found in almost every home in America (Topher).
Market Size & Industry Statistics. The total U.S. industry market size for Breakfast Cereal Manufacturing: Industry statistics cover all companies in the United States, both public and private, ranging in size from small businesses to market leaders.
In addition to revenue, the industry market analysis shows information on employees, companies, and average firm size.
US Cereal Production industry takes raw materials like corn, wheat, flour, and sugar from different sources and turns these ingredients into ready-to-eat cereals, hot cereals, and cereal bars Main activities involve manufacturing: cold and hot breakfast cereal.
The industry's major product is ready-to-eat (RTE) cereal.
The most popular cereals are made with corn flakes, wheat, oats, mixed grains, or puffed rice. Other products include instant hot cereal, rolled oats, farina, and infant cereal.
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Cereal manufacturers with the most cereals in our cereal database. View all manufacturers by logo. All Cereal Manufactures: Abbott Nutrition 3 cereals found Annie's Homegrown 9 cereals found Arrowhead Mills 19 cereals found Atkins Nutritionals 3 cereals found.Download