Case Study: Harley-Davidson, Inc.: Troubled Times Increase H-D’s Reliance on International Sales.
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Case Study: Harley-Davidson, Inc.:Troubled Times Increase H-D’s Reliance on International Sales. 1. Which of Porter’s generic strategies is H-D using? Will this strategy work for all of the countries described in the case? Why or why not?
Answer: H-D using “Differentiation Strategy” by offering its heavyweight motorcycle through the distinctive designs. H-D are also a leader in the heavyweight motorcycle manufacturers industry and it has more than 100 years old in this market, also its American icon make H-D become traditional brand. Due to H-D becoming the traditional brand in American made version, the consumers perceive that H-D mean quality. Consumers will choosing H-D products because of their high quality products and demand…show more content… Answer: Force 1: The Degree of Rivalry The intensity of rivalry, which is the most obvious of the five forces in an industry, helps determine the extent to which the value created by an industry will be dissipated through head-to-head competition. The most valuable contribution of Porter's “five forces” framework in this issue may be its suggestion that rivalry, while important, is only one of several forces that determine industry attractiveness.
Force 2: The Threat of Entry Both potential and existing competitors influence average industry profitability. The threat of new entrants is usually based on the market entry barriers. They can take diverse forms and are used to prevent an influx of firms into an industry whenever profits, adjusted for the cost of capital, rise above zero. In contrast, entry barriers exist whenever it is difficult or not economically feasible for an outsider to replicate the incumbents’ position (Porter, 1980b; Sanderson, 1998) The most common forms of entry barriers, except intrinsic physical or legal obstacles, are as follows: Force 3: The Threat of Substitutes The threat that substitute products pose to an industry's profitability depends on the relative price-to-performance ratios of the different types of products or services to which customers can turn to satisfy the same basic need. The threat of