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Porter Five Forces Model

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA APM Exams › Porter Five Forces Model

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by Ken Garrett.
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  • May 19, 2017 at 1:42 am #386932
    irenegsy
    Member
    • Topics: 26
    • Replies: 10
    • ☆

    Hi sir

    I would like to ask the area of threat of entry, differentiation is one of the factor inside threat of entry, so I would like to ask if

    High differentiation of product, low threat of entry or
    Low differentiation of product, high threat of entry…

    Thank You.

    May 21, 2017 at 12:47 pm #387244
    Ken Garrett
    Keymaster
    • Topics: 10
    • Replies: 10611
    • ☆☆☆☆☆

    Broadly right. High differentiation implies a better/special product which usually means more research and development hence a higher entry barrier.

    Low differentiation implies simpler products so easier to get into.

    However, if not differentiating, then cost leadership is implied for sustainable success and that can imply very large, efficient factories. That can mean relatively high barriers.

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