How did Economies of scale impact on industry?

Economies of scale refer to the cost advantages that businesses experience as they increase production, leading to a decrease in the per-unit cost of goods. This phenomenon impacts industries by allowing larger companies to dominate markets, as they can produce goods more efficiently and at lower prices than smaller competitors. As a result, industries often see consolidation and a trend towards fewer, larger firms, which can stifle competition and innovation. Additionally, economies of scale can lead to increased barriers to entry for new businesses, making it challenging for startups to compete.