The porter’s five forces can be used to establish the competitive intensity thereby the attractiveness of a market. Attractiveness refers to the industry profitability. An industry where there are combinations of forces that drive down the industry profitability is known as ‘unattractive’ industry. A very unattractive industry refers to the industry approaching pure competition.
The porter’s five forces include;
Threat of entry of newcomers
Threat of substitute products
Intensity of competitive rivalry
Bargaining power of suppliers
Bargaining power of customers
Michael porter’s model is a powerful tool that can be used to scrutinize the industry economy and the attractiveness of Continue reading...