Coles and Woolworths is dominating the Australian supermarket/grocery sector

The Australian supermarket/grocery sector represents the oligopoly market structure. The oligopoly market structure is a market arrangement structure in which there are several but a few numbers of large firms in which none of them has the potential to restrict others from influencing the market. Also, the oligopoly market structure has barriers to entry and exit and the products sold may either be similar or differentiated.

The oligopoly market structure is highly common in the Australian supermarket sector because it increases or enhances competition within the firms in the structure, thus improving the quality and prices and products they sell. Since several firms in the market can freely influence the market, each firm will strive to be the best in the market. This can be done by ensuring the production of quality and cost-effective products to attract customers.

Also, the oligopoly market structure enhances innovation and development. Innovation is defined as the process of creating or developing new business strategies and ideas that can help a business to have significant benefits in the markets. Each firm will also strive to produce unique