Traditionally, the market has been the place where buyers and sellers met to carry out their commercial operations. This concept of the market was linked to a geographical location, but as a result of progress and communications, this term has become detached from its local character.
Hence, nowadays it fits better with the market definition the set of buying and selling acts associated with a specific product or service at a given moment in time, without there being any reference to space.
In the market it is composed of all the supply and demand for products and services. In it we can find all the competition of companies struggling to gain a foothold in it, and also all the people who demand products. In such a competitive market it is difficult for a company to reach the entire public, so it divides it into market segments those it targets most effectively.
Types of markets
Markets can be classified in different ways based on a number of elements. The different classes of market are:
According to the volume:
- Wholesale markets: with a high volume of sales.
- Retail markets: low sales volume.
According to the number of bidders:
- Monopoly: there is only one single supplier of a service or product that is in high demand by the market. By controlling exclusively you can establish the conditions and prices of sale.
- Oligopoly: there are a few suppliers of a product, so they agree to establish price conditions. That way there will be no competition between them.
- Perfect competition: it is the most appropriate situation, as there are many sellers and buyers. None of them influence the operation of the market, so it will be easier to achieve more beneficial prices for the customer.
According to transactions on services or goods:
- Goods market: merchandise and articles are acquired and traded.
- Market of services: it refers to the contracts.
According to regulation:
- Regulated markets: the authorities are in charge of controlling the conditions of sale and prices.
- Deregulated markets: it is the market itself that is responsible for setting prices according to supply and demand, without the participation of the state.
According to the agents involved:
- Consumer market: that is supplied by retailers.
- Retail market: which is supplied by semi-wholesalers.
- Semi-wholesale market: which is supplied by wholesalers.
- Wholesale market: which is supplied by producers or manufacturers.