- This topic has 3 replies, 2 voices, and was last updated 8 years ago by
.
- Posts
In Five forces, suppose a company wants to do this analysis in their current situation and industry, then will the factors like bargaining power of customers, suppliers be seen on a wide scale including all its competitors?
Or will the bargaining power of customers be analyzed according to their own company only?
For example, Company A has a high bargaining power against its customers whereas Company B has low bargaining power against its customers
In that way, will the Five forces be applied in industry level or relating to the specific company?Generally, 5 forces relates to industry sectors, not individual firms. So, Nissan, VW and Ford all face similar pressures from customers and suppliers such as steel manufacturers.
But what if some companies in the industry have long term contracts where the prices are fixed for lets say the next 5 years with the suppliers and some don’t have these contracts, then how should I comment in such a situation?
Because partly in some companies, the supplier power is low whereas in other companies, it is high. Eventhough all these have the same suppliers, its just the matter of contract which has reduced the power
- You must be logged in to reply to this topic.