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Competition Laws
By Sam Vaknin, Ph.D.


Metal Decking
You need steel decking delivering to site in less than five days or the entire project will be held up. Looking around you stumble across a fine supplier of Metal Decking who offers this kind of delivery service. In fact, speak to the guys who specialise in rapid steel decking and depending on the type that you require you could have your materials packed and delivered much sooner than you could hope for. The versatility of the Metal Decking means that you can specify the exact size that you want cutting. It can also be packed to your precise orders thus making installation on site far easier in the future. Having discovered the flexibility of Metal Decking a while back you have come to appreciate how much quicker projects can be completed when this type of system is used as part of the flooring. Indeed, youâ??ve also cut down on the amount of concrete that you need for your floors thanks to this brilliant type of scheme. In the future all of your construction projects will incorporate the Metal Decking at some point. Now that you know about this brilliant supplier it seems foolish to place your orders anywhere else.

Fibreglass Handrails
Fibreglass has been proven as an effective, lightweight and low maintenance material to be used in many different safety railings such as handrails and barriers. Fibreglass Handrails are commonly used in industrial and commercial environments such as power plants, water treatment works, warehouses and factories. Many organisations choose to use Fibreglass Handrails instead of hand rails made from more tradditional materials like wood or steel as fibreglass is an extremely high strength material. It is also very lightweight, fire retardant and has a low thermal conductivity which is essential as an added health and safety element when used in hazards or dangerous working environment. Fibreglass Handrails can also be used in the home and can be specially designed to be fitted into the home of the elderly or disabled as a safety railing on walkways, ramps or stairs. Outdoors, they can be used on walkways and ramps to provide a deterrent to skateboarders.

Access Hire
I had a number of part time jobs whilst I was at university. One of the summer jobs that I took was at an Access Hire firm that hired out boom lifts to contractors. This team hired out diesel and battery powered cherry pickers as well as scissor lifts. My job was to assi and the ban should be enforced.

Lead Free Solder
My first and only experience of working with solder was at school when I was taking part in an electronics class. The task was simple, we had to solder two wires together without making too much of mess. This proved to be mission impossible for some of my fellow pupils and solder ended up everywhere. Mr Potts the science teacher was on the verge of a nervous breakdown and to this day I wonder what happened to him because he never came back after the summer holidays. Solder has in fact been around for thousands of years and today Lead Free Solder is used in plumbing applications where copper pipes need to be sealed together. The Lead Free Solder provides a fusion between the two pipes and the clever thing is; if they need to be separated in the future they can be, because the solder can be reheated until it melts and the pieces can be pulled apart. It stands to reason that you`d want to use Lead Free Solder if you were working on water pipes. Chances can`t be taken with drinking water and lead free materials are a must to protect from any kind of contamination. My one and only experience of solder came in my science class at school and this memory still lives with me to this present day.

Proliferate "brand names" to make it too expensive for small firms to grow - By creating and maintaining a host of absolutely unnecessary brandnames, the competition`s brandnames are crowded out. Again, this cannot be legislated against. A firm has the right to create and maintain as many brandnames as it wishes. The market will exact a price and thus punish such a company because, ultimately, its own brandname will suffer from the proliferation.

Get a "corner" (control, manipulate and regulate) on raw materials, government licenses, subsidies, and patents (and, of course, prevent the competition from having access to them).

Build up "political capital" with government bodies; overseas, get "protection" from "the host government".

`Vertical` Barriers

Practice a "preemptive strategy" by capturing all capacity expansion in the industry (simply buying it, leasing it or taking over the companies that own or develop it).

This serves to "deny competitors enough residual demand". Residual demand, as we previously explained, causes firms to be efficient. Once efficient, develop enough power to "credibly retaliate" and thereby "enforce an orderly expansion process" to prevent overcapacity

Create "switching" costs - Through legislation, bureaucracy, control of the media, cornering advertising space in the media, controlling infrastructure, owning intellectual property, owning, controlling or intimidating distribution channels and suppliers and so on.

Impose vertical "price squeezes" - By owning, controlling, colluding with, or intimidating suppliers and distributors, marketing channels and wholesale and retail outlets into not collaborating with the competition.

Practice vertical integration (buying suppliers and distributionb and marketing channels)

This has the following effects:

The firm gains a "tap (access) into technology" and marketing information in an adjacent industry. It defends itself against a supplier`s too-high or even realistic prices

It defends itself against foreclosure, bankruptcy and restructuring or reorganization. Owning suppliers means that the supplies do not cease even when payment is not affected, for instance.

It "protects proprietary information from suppliers" - otherwise the firm might have to give outsiders access to its technology, processes, formulas and other intellectual property.

It raises entry and mobility barriers against competitors. This is why the State should legislate and act against any purchase, or other types of control of suppliers and marketing channels which service competitors and thus enhance competition.

It serves to "prove that a threat of full integration is credible" and thus intimidate competitors.

Finally, it gets "detailed cost information" in an adjacent industry (but doesn`t integrate it into a "highly competitive industry")

"Capture distribution outlets" by vertical integration to "increase barriers";

`Consolidate` the Industry

Send "signals" to threaten, bluff, preempt, or collude with competitors

Use a "fighting brand" (a low-price brand used only for price-cutting)

Use "cross parry" (retaliate in another part of a competitor`s market)

Harass competitors with antitrust suits and other litigious techniques

Use "brute force" ("massed resources" applied "with finesse") to attack competitors

or use "focal points" of pressure to collude with competitors on price

"Load up customers" at cut-rate prices to "deny new entrants a base" and force them to "withdraw" from market;

Practice "buyer selection," focusing on those that are the most "vulnerable" (easiest to overcharge) and discriminating against and for certain types of consumers

"Consolidate" the industry so as to "overcome industry fragmentation".

This arguments is highly successful with US federal courts in the last decade. There is an intuitive feeling that few is better and that a consolidated industry is bound to be more efficient, better able to compete and to survive and, ultimately, better positioned to lower prices, to conduct costly research and development and to increase quality. In the words of Porter: "(The) pay-off to consolidating a fragmented industry can be high because... small and weak competitors offer little threat of retaliation"

Time one`s own capacity additions; never sell old capacity "to anyone who will use it in the same industry" and buy out "and retire competitors` capacity."

Lift Designer
My best friend has met a new boyfriend recently and she appears really smitten with him. I asked her what he does for a living and she told me that he is a Lift Designer. I was intrigued by this as I had never met anybody who was a Lift Designer before and asked her what was involved in his job. She told me that she didn`t know what was involved in being a Lift Designer either as she had thought that it was a little rude to quiz him incessantly about his job. However, she did say that she thought he made a lot of money at his job since he was always paying and treating her to expensive nights out at the top restaurants and bars. I said that this sounded fantastic and have asked her to set up a meeting with him very soon. She has said that she is going to plan a really exciting dinner party menu as this is one way that she can repay him for all his generosity when they go out together. I thought this was a great idea as it also would be good for her friends to meet him when she is on her own territory rather than in an unfamiliar environment. I am really hopeful that this relationship will go far and I can`t wait to meet him.

For more information, news and articles see:
Lift Designer
Self Storage Victoria

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