2 - Five Forces Analysis

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Intensity of Existing Rivalry Government limits competition (2) Government policies and regulations can dictate the level of competition within the industry. When... Large industry size (2) Large industries allow multiple firms and produces to prosper without having to steal market share... Fast industry growth rate (2) When industries are growing revenue quickly, they are less likely to compete, because the total... Bargaining Power of Suppliers Low concentration of suppliers (2) A low concentration of suppliers means there are many suppliers with limited bargaining power. Low... Volume is critical to suppliers (2) When suppliers are reliant on high volumes, they have less bargaining power, because a producer can... Low cost of switching suppliers (2) The easier it is to switch suppliers, the less bargaining power they have. Low supplier switching... Threat of Substitutes Substitute has lower performance (2) A lower performance product means a customer is less likely to switch from 2 to another product or... Substitute product is inferior (2) An inferior product means a customer is less likely to switch from 2 to another product or service. Substantial product differentiation (2) When products and services are very different, customers are less likely to find comparable product... Bargaining Power of Customers Large number of customers (2) When there are large numbers of customers, no one customer tends to have bargaining leverage.... Threat of New Competitors Strong distribution network required (2) Weak distribution networks mean goods are more expensive to move around and some goods don’t get to... High capital requirements (2) High capital requirements mean a company must spend a lot of money in order to compete in the... Strong brand names are important (2) If strong brands are critical to compete, then new competitors will have to improve their brand... Advanced technologies are required (2) Advanced technologies make it difficult for new competitors to enter the market because they have to... Industry requires economies of scale (2) Economies of scale help producers to lower their cost by producing the next unit of output at lower... Geographic factors limit competition (2) If existing competitors have the best geographical locations, new competitors will have a... High learning curve (2) When the learning curve is high, new competitors must spend time and money studying the market... Entry barriers are high (2) When barriers are high, it is more difficult for new competitors to enter the market. High entry... What is Porter's Five Forces Analysis? WikiWealth's Five Forces analysis evaluates the five factors that determine industry competition. Add your input to 2's five forces template. See WikiWealth's tutorial for help. Is WikiWealth missing any analysis? Check out our entire database of free five forces reports or use our five forces generator to create your own. Remember, vote up 2's most important five forces statements.