- This topic has 1 reply, 2 voices, and was last updated 9 years ago by
.
- Posts
Please advice us in this question NESTA June 2013 , Im getting difficult to apply model oF Poters five force frame work in the question , when i read the answer of examiner. I find it difficult to summery it
You have to go through each of the five forces and find something in the scenario that allows you to comment on each force. For example:
There are three powerful competitors who want to expand. They will fight to keep market share. However, the whole market is expanding so each company can increase sales without stealing market share from any of the others.
There are some considerable entry barriers (premises and brand recognition)
Substitutes: internet might be, but is unlikely to be viable in this very cheap market because delivery would probably cost more than the goods.
The goods are non-specialised so suppliers will not be able to exert much pressure.
Customers do not have much power, but on the other hand, will not show much loyalty to any one company. There are no switching costs for customers and it will be difficult to tie any of them in.
- You must be logged in to reply to this topic.