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Take into account a large airline that provides almost all of the flights concerning two particular towns. A fresh, modest start off-up airline chose to give provider concerning both of these metropolitan areas.
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Many companies expend large quantities to market their solution as the most beneficial (or the only great) substitute in the market. This leads to the creation of a solid brand place available in the market which functions as a strong barrier to overcome.
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A natural monopoly may come up in scaled-down area markets for items that are hard to transport. For example, cement creation exhibits economies of scale, and the quantity of cement demanded in a neighborhood place is probably not much bigger than what a single plant can develop.
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The company can also opt to only manufacture on-demand from customers or on order to avoid above-committing methods that could have been applied in other places.
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