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Therefore competition policy has prevented creating monopolies and mergers that will lead to monopolies. A monopoly will be a company that has acquired a large percentage of its industry’s market share and hasn’t let any other organisation compete with them. Therefore people will buy the particular product or service only from them and market entry is automatically prohibited for others. Therefore MULLAI cabs will not be allowed to become a monopoly company in the cab service industry. Another regulation – according to the data protection act in UK, the MULLAI cabs will not be able to save the personal information of the customers and save them on any other purposes. For example, they will take the mobile numbers, emails addresses or addresses from customers when providing a service. However they aren’t allowed to use this information unnecessarily for marketing activities or to sell them to others. According to the fair trade regulations, the cab service will need to display the charges they charge inside the car of vehicle of the cab services and the meters should be fixed to calculate the fare.
These fares should be transparent and hidden charges shouldn’t be applied. The market structures will a combination of factors that are related to interaction between the producers which will control pricing of products. The factors such as number of competitors in the market, the product or service types, entry possibility for new entrant to the industry, size of the customer market will be factors that are part of the market structure. The unhealthiest type of market structure is the monopoly market. In the monopoly market there will be only one company that has taken over almost all of the market share and all the customers will buy the particular product or service from them. Oligopoly is a market structure where the pricing controlled by few number of large companies and they have owned the market share together. These oligopolistic companies will be the market leaders and new entrance for the market will not be possible.
Oligopolistic market is also unhealthy market since there are few competitors who will control the prices and customers will have to buy from them for whatever the prices they offer. The airline industry in UK is an example for oligopoly market structure. In the perfect competition market, all the producers will own a certain amount of the market share and none of them will be dominant to control the prices. The price of the goods will be set by industry standards, by the demand and supply of the goods. The cab service market can be seen as a perfect competition market where new entrance is also possible for a new company. The market forces will be factors that impact the prices and growth of the market and will influence the behaviour of customers, companies and the production. The supply in the market is one of most common forces. Supply refers to the available or on- going production of goods or services in the market.