MGT576_Wk3_Porters_Five_Forces_Iwaszewski

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University of Phoenix *

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MGT/576

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Management

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Apr 3, 2024

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docx

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1 Porter's Five Forces Eva Iwaszewski MGT/576 – Opportunity Evaluation and Value Creation Dr. Louay Chebib December 4, 2023 Industry force   Strength Provide a justifying your determination with examples High   Medium   Low   Threat of new entrants  x I believe the threat of new entrants is
2 Industry force   Strength Provide a justifying your determination with examples low due to the high barriers to entry. The oil and gas industry requires significant upfront capital investment, making it difficult for new entrants to establish themselves in the market. For example, a new oil company enters the industry, there are high startup costs which mean that very few companies even attempt to enter the sector. This lowers potential competition from the start. Proprietary technology forces even those with high startup capital to face an immediate operating disadvantage upon entering the sector. Power of buyers  x I believe the power of buyers is low due to the essential nature of the products and services offered by other oil companies. For example, Exxon Mobil, is another oil and gas company that are crucial inputs in various industries, which include transportation, manufacturing, and energy production. Power of suppliers  x I believe the power of suppliers is of moderate strength and that the threat substitute products are still, far off, and less credible in the short run, it is also observed that the industry has high barriers to entry, Finally, the study revealed that there are both intensive rivalry and evidence for collaboration among existing players in the oil and gas industry. Power of substitutes  x I believe the power of substitutes is moderate due to the limited number of buyers: In the energy industry, buyers are often large industrial entities or governments. Their relatively small number and limited alternatives for sourcing energy can reduce their individual bargaining
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