competitive forces prepared by: mahmoud dalloul 120070211 supervisor: ms. yasmin al bobo up...
TRANSCRIPT
COMPETITIVE FORCES
Prepared by: Mahmoud Dalloul 120070211
Supervisor: Ms. Yasmin Al Bobo
UP 3(2009-2010)
Competitive Forces
Awareness of the five forces can help a company understand the structure of its industry and stake out a position that is more profitable and less vulnerable to attack.
Porter’s Competitive Forces
1. Rivalry of competitors within an industry
2. Threat of new entrants into an industry
3. Threat posed by substitute products which might capture market share
4. Bargaining power of customers
5. Bargaining power of suppliers
Porter’s Competitive Forces
Rivalry of competitors
Online-shopping, E-commerce increase rivalry
Price comparison tools (Google Product Search, Shopzilla, etc.) increase rivalry. Price transparency
Industries with high rivalry?
Industries with low rivalry?
Threat of new entrants
E-commerce enables a business to emerge overnight
A medium-sized retail store can become a global E-commerce competitor at little cost.
Whereas, it costs a lot to become a
global donut competitor
Substitute Products
Internet makes substitutes easier to find. Can’t afford to fly...take a train. Ipod to expensive...buy a Microsoft Zune
Bargaining power
Customer:
E-commerce has empowered the customer
Examples: Ebay Lending Tree Reverse auctions
Drives prices down!
Suppliers:
Example: A leading supplier can force retailers to invest in their Supply Chain Mgmt. system.
Pushes costs on to the retailer
More profit for the suppliers