Commodity Business

A business whose products are largely fungible (i.e., interchangeable) commodities. Such businesses are characterized by the sales being price-driven, i.e., that customers are primarily concerned and effected by price and not by other differentiating factors, e.g., quality, reputation, etc. In other words, the business lacks any USP.  Cartels are more common in industries whose products are heavily commoditised as a way to resist price pressure, so companies in such business should have rigorous antitrust and competition law compliance programs.

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