McDonald's Restaurant - Five Forces Analysis

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Intensity of Existing Rivalry Large industry size (McDonald's Restaurant) Large industries allow multiple firms and produces to prosper without having to steal market share... Bargaining Power of Suppliers Large number of substitute inputs (McDonald's Restaurant) When there are a large number of substitute inputs, suppliers have less bargaining leverage over... High competition among suppliers (McDonald's Restaurant) High levels of competition among suppliers acts to reduce prices to producers. This is a positive... Low concentration of suppliers (McDonald's Restaurant) A low concentration of suppliers means there are many suppliers with limited bargaining power. Low... Critical production inputs are similar (McDonald's Restaurant) When critical production inputs are similar, it is easier to mix and match inputs, which reduces... Volume is critical to suppliers (McDonald's Restaurant) When suppliers are reliant on high volumes, they have less bargaining power, because a producer can... Threat of Substitutes Substantial product differentiation (McDonald's Restaurant) When products and services are very different, customers are less likely to find comparable product... Bargaining Power of Customers Buyers require special customization (McDonald's Restaurant) When customers require special customizations, they are less likely to switch to producers who have... Large number of customers (McDonald's Restaurant) When there are large numbers of customers, no one customer tends to have bargaining leverage.... Threat of New Competitors Strong distribution network required (McDonald's Restaurant) Weak distribution networks mean goods are more expensive to move around and some goods don’t get to... High capital requirements (McDonald's Restaurant) High capital requirements mean a company must spend a lot of money in order to compete in the... High sunk costs limit competition (McDonald's Restaurant) High sunk costs make it difficult for a competitor to enter a new market, because they have to... Customers are loyal to existing brands (McDonald's Restaurant) It takes time and money to build a brand. When companies need to spend resources building a brand,... Strong brand names are important (McDonald's Restaurant) If strong brands are critical to compete, then new competitors will have to improve their brand... Industry requires economies of scale (McDonald's Restaurant) Economies of scale help producers to lower their cost by producing the next unit of output at lower... What is Porter's Five Forces Analysis? WikiWealth's Five Forces analysis evaluates the five factors that determine industry competition. Add your input to mcdonald-s-restaurant'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 mcdonald-s-restaurant's most important five forces statements.