The Economics Of The Brick Cycle and Its Effects on Firm and Industry Structure

Home and Abstract Introduction Brick Demand UK House Construction

The Economics of Brick Production

Increasing Concentration of the Brick Industry II III IV V VI VII VIII IX

Conclusions Brick Industry Other Cyclical industries -Christmas trees

  Abstract

This web site describes the economics behind the UK brick making industry and explains how this contributed to an increase in industry concentration during the 1970's and 1980's.


ABSTRACT

 

The original purpose of this dissertation in studying the brick industry, which is noted for its widely fluctuating demand and therefore the particularly volatile nature of the revenues of individual firms within it, was to investigate the extent to which this volatility actively encouraged managerial risk avoidance behaviour in the form of company mergers, and whether this was the major cause of increases in market concentration levels and changes in firm ownership within the industry.

However, with more research, it soon became apparent that there were very real physical aspects of brick production which, because of the need to equate supply with fluctuating demand, in themselves encouraged both mergers within the industry and mergers with firms from outside the industry. This was because the short-term requirement to alter production levels quickly was facilitated to a very great extent if an individual yard was part of a larger grouping.

This dissertation therefore attempts to show how fluctuating demand, combined with certain physical features of production, can have a considerable affect over the behaviour of both a firm and an industry as a whole and, in particular, show how concentration levels in the brick industry have been influenced in this way.

For more on the UK brick industry the Brick development Association has a great web site listing many manufacturers of Bricks in the UK.

 

Christmas trees and Christmas tree Farms

Christmas trees are also studied in this management review. Christmas trees have a very long product cycle: it takes seven to eight years for an individual Christmas tree to reach maturity. The farmer has to decide well in advance what type of tree to grow and how many. As such, it is the supply rather than demand for Christmas trees that are highly cyclical. Similar to the hog cycle, where cob-web theory works well, the Christmas tree cycle lasts much longer.

Christmas tree farm in Chesham has to go through this decision making process, they have a very good web site at Christmas tree farm Chesham, which describes the Christmas tree stands, decorations and Christmas tree lights that they sell. Christmas tree farm also sells mistletoe, and holly wreaths. Traditional and non-drop trees.

 

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R Mathews - any comments? info@brickbat.co.uk

These pages are brought to you with the help of Christmas tree farm Chesham for fresh Christmas trees every Christmas