Michael Porter’s 5 Force Model

Five Force Model

Threat Of New Entrants

Brings new capacity and a desire to gain market share that puts pressure on prices,costs….

Barriers to entry:1. Supply side economies of scale2. Demand side benefits of scale3. Customer Switching costs4. Capital requirements5. Unequal access to distribution channels

Bargaining Power of Suppliersand

Bargaining Power of Buyers

Rivalry among existing Competitors

Sustainable competitive advantage through innovation.

Level of advertising expense Powerful competitive strategy The visibility of proprietary items on the

Web used by a company which can intensify competitive pressures on their rivals.

Threat of Substitute Products

Attractive Price Performance trade off to the industry’s products … (Telephone to skype)

The buyer’s cost of switching to the substitute is low…

Conclusion……

When making a qualitative evaluation of a firm's strategic position

Should be used at the line-of-business industry level.

Corporate strategy is the selection of industries (lines of business) in which the company should compete.

Each line of business should develop its own, industry-specific, five forces analysis

Presented By-

Invogue Pallavi Khanna Isha Singh Dinesh Singh Mayank Maindola