Barriers to entry

Definition

Barriers to entry are obstacles that make it difficult for new entrants to enter a market or industry. These can include high startup costs, stringent regulations, and established competition.

Related terms

Market Monopoly: A situation where a single company or entity has exclusive control over a particular market or industry, often created or maintained by high barriers to entry.

Economies of Scale: The cost advantage achieved by businesses when production becomes efficient, as costs can be spread over a larger number of goods, contributing to barriers for new competitors.

Regulation: Rules set by authorities that govern how businesses can operate within certain industries, which can act as a barrier to entry for new firms not equipped to meet these standards