Consider how this principle works for the monopolistically competitive restaurant market in Shady Valley. Manny Mustard's House of Sandwich is one participating firm. Manny's specialty, the Deluxe Club Sandwich, offers a prime example of this principle.

• First, Manny must make sure that his product is similar to other products. At the very least, being that he is operating in the restaurant industry, his Deluxe Club Sandwich must be a food product. Should Manny replace his bread, lettuce, tomatoes, and meat, with cardboard, plastic, aluminum, and barbed wire, then he cannot compete effectively for food-hungry buyers. If Manny hopes to attract a lunch crowd, then he must sell food.

  Taking this a step farther, if Manny hopes to compete with other establishments selling club sandwiches, then his club sandwich must be similar to their club sandwiches. If they use ham, turkey, and bacon, then he needs to use ham, turkey, and bacon. If he leaves off the bacon, then he does not have a club sandwich, he has a ham and turkey sandwich.



• Second, within the specifics of this product type, Manny can seek differences from the competition. This is why Manny makes his Deluxe Club Sandwich with barbecue sauce rather than mayonnaise. He could also use leaner, fat free, cuts of ham and turkey. Perhaps he could use homemade bread. Maybe he could chop his bacon rather than using strips.

  The key, of course, is that Manny seeks to make his Deluxe Club Sandwich a little different from the hundreds of other club sandwiches available in the market. The uniqueness of Manny's Deluxe Club Sandwich is what gives him a teeny, tiny monopoly-slice of the overall market. This is what allows him to charge a slightly higher price than that paid for a generic, run-of-the-mill, nothing-special-about-it, club sandwich.