Friday, August 20, 2010

famous knoxville duopolies?

of all knoxville's oddities and quirks, one of the things that puzzles me is when I pass by the following sets of businesses and wonder how on earth could they still be operating as separate small businesses. ironically, they're both on sutherland.


similar produce stands on sutherland



outdoor products stores, across the street from each other

econ theory suggests that they could increase profits by legally merging (to set prices higher, and restrict quantity sold) as long as their products are exactly the same. this would increase overall market power (in a legal sense) and would probably be easier for the produce stands than the outdoor stores since the latter are selling manufactured and specialized goods. but, what if we had one larger store for each type, and each offered expanded operating hours (for both) and more events (for the outdoor store) under one roof. going farther, if the produce stands collude, they could perhaps more easily open new fresh produce markets in underserved areas, one particular location comes to mind (at broadway and grainger, read more here).

as i write this, i realize that our readers probably have preferences of one of these stores over the other, or may choose another store that's in a different location altogether. for me, river sports is usually the front runner in outdoor gear in terms of popularity and quality of service. do you agree?

but the dominant firm in the produce example seems a little more ambiguous.

as the two sets of businesses stand now, they appear to compete. or, do they? for you econ oriented types, is some speculation to cooperation (price or output setting, aka illegal collusion as a cartel) justifiable?

9 comments:

The Modern Gal said...

Sutherland/Strawberry Fields is the same thing. The other Sutherland market is Farm Fresh Produce. Sutherland/Strawberry Fields is superior solely for its sale of Benton's Bacon.

Lo said...

whoops- i must have used the wrong picture! thanks for picking up on that.

ck said...

After dealing with the snobbish attitudes and general lack of helpfulness at ETO a few times, I became a River Sports man. Competition didn't spur on better service in that case.

The Modern Gal said...

It's funny that you've got two clear duopolies both on Sutherland. I wonder why that is?

em said...

and what about all those chicken finger shacks on the strip? Of course, those aren't small businesses. and the one that was a small business (mcdougals) went out of business.

Joe Ossenmacher-Bedford said...

A clear vote for Farm Fresh Produce. That other joint had higher prices and more attitude.

caryn the designer said...

I vote for Farm Fresh Produce as well. Have only been to Sutherland Market once and the selection was poor, workers unfriendly and prices higher. Farm Fresh Produce is owned by a Grainger County farmer named Rodney. He's really nice and friendly. His crop of peppers are always awesome! Love it there.

I personally go to RiverSports because of their coffee shop, rock wall, and my creative firm did their website. :)

caryn the designer said...

Oh and Farm Fresh also has a connection with an Amish Farm in Kentucky so every Thursday they get a bunch of fresh bread, butter, cookies and pies from an Amish family to sell. Incredible!

Lo said...

I think em is onto something here: is there a chicken finger cartel on the strip? we need more info on this. from what joe and caryn say, i think i should be shopping at farm fresh produce, if only they would stay open longer (notice that all stores are closed in these pictures at around 8, which happens to be what time lo does his shopping).