Scenario Marc has opened a 24-Hour fitness center in a fast-growing city. Before

Question

Scenario

Marc has opened a 24-Hour fitness center in a fast-growing city. Before purchasing the franchise and starting his new business, Marc looked at the one other fitness center currently operating in that area. In the same general area are video game rooms, fast food restaurants, a sports bar, a golf driving range, a sporting goods store, and a bowling alley. Marc believes that the one fitness center forms his competition.

Based on your reading of open systems and “Substitutes and Complements” in the text, do you agree with Marc or disagree? Why?

Explanation / Answer

Substitutes are the product and services that can be used in place of one another. Complements are the product and services that complements sales of each other.

Yes it is true that the one fitness center in that area form his completion. However looking at the other fact that the area has video game rooms, fast food restaurants, a sports bar, a golf driving range, a sporting goods store, and a bowling alley makes the area a happening place where people keep on visiting. The area will attract a reasonable crowd where Marc will be able to attract customer for his fitness center.

Some of the other activity in that area form substitutes and some form compliments. Like Sporting goods store, bowling alley, sports bar requires a person to be fit and fitness center will help to be fit. Thus these activity forms complements for the fitness center..

The other existing fitness center is the substitute for the marc fitness center.

Also city is very fast growing, which signifies that the business will also grow. Opening new fitness center in the growth stage of the whole region will help to grow mark fitness center.

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