Conduct A Porter 's Five Force Analysis

Porter’s Five Forces is a framework that consists of five competitive forces, threat of entry, power of supplier and buyer, threat of substitution and competitive rivalry. These forces facilitate the analysis of the task environment of an industry or company (Wheelen and Hunger, 2009).

The retail industry is a highly competitive and mature. For this reason, above-average returns can only be obtained by competitive actions and responses against competitors. Porter five forces model will be used to analysis the development and competition situation in retail industry.

This essay will use the Porter’s five forces to analyse the supermarket industry in the US, and I will make a decision on whether the US supermarket industry is attractiveness based on its overall profitability level.

The first of Porter’s Five Forces is the threat of new entrants. According to the case study, there has been a wave of new entrants to the retail industry. These include Best Buy, Costco, Wal-Mart, Old Navy and the recently irrelevant, Target Canada. The second force, the threat of substitute products or services, is also prevalent in the retail market. Inevitably, the target audience that the Hudson’s Bay Company is trying to cater to, will shop at other retail stores for the same goods due to consumers behaviours and preferences. Another impacting force is the bargaining power of suppliers. However, this force does not play as large of an impact to HBC as one might initially assume. Traditionally, HBC among other large retail stores makes a large percentage of their

The fourth force that makes up Porter’s Five Forces is the bargaining power of buyers. For MillerCoors specifically, the main buyers are distributors. The distributor controls the price by setting it on profit margins. In addition, distributors are consolidating and increasing in power. For example, in 1970 there were 5,000 distributors; today there are only 2,500 distributors. The distributors are also eliminating new competition. Two examples of this are how MillerCoors puts pressure on itself to carry its own brand and how there are more and more regulations on beer. Because of these reasons, there is more power to current distributors than there was in the past.

First, Porter’s Five Forces analysis method is used as an “initial step” in evaluating new markets. This method is first introduced in the book during Justin and Scott Beckett’s, VP and General Manager of Oil and Gas division at HGS, meeting in which they discussed their analysis of the men’s white dress shirt industry. Beckett goes as far as using the Five Forces model to describe how all kinds of threats are high (Rivalry, Buyer Power, Substitutes, Entry, and supplier Power). Justin quickly buys into Beckett’s argument and how the men’s white dress shirt industry is not a viable option for Plastiwear to enter. This is an example of Justin deterring from his original views and altering them to agree with the other party, which cannot be necessarily correct in the situation regarding Beckett’s view. As senior director, Ken McCombs states, the most attractive industries according to the five forces approach would have no rivalry, no close substitutes, no threats, and no powerful buyers or suppliers. This type of industry makes us go with lower risk markets, which

This factor in the Porter Five Forces Model refers to the power that those companies supplying products to Target have. In the retail industry, suppliers are often very powerful, as they often provide products to direct competitors of each other. An example of a supplier with a high degree of power is Procter and Gamble (P&G), who sells to many retailers including Target, WalMart, Costco, Safeway and many others. As P&G is a leader in personal care products that are more often sold on price and availability than intensive shopping comparisons (like how plasma TVs are purchased for example) this supplier has major influence over Target and their profitability. This is the reason why this specific aspect of the five forces model is first. Target Corporation

In the five forces model by Porter, four forces will influence the fifth one (see the model on the right). The bargaining power of suppliers, the bargaining power of customers, the threat of substitute products and the threat of new entrants will influence the fifth force: the level of competition in the industry (S.Clegg, C.Carter, M.Kornberger, & J.Scheitzer, 2011).

Porter 's five forces framework assesses the competitive pressures a company faces within the industry. The five forces of competitive pressure include: competition from rival sellers, competition from potential new entrants to the industry, competition from producers of substitute products, supplier bargaining power and customer bargaining power. The model helps us determine the strength of competitive pressures and profitability of an industry. [3]

Porter 's Five Forces Model is a critical instrument to break down an outer aggressive environment of the business. The model incorporates threat of entry, the threat of rivalry, the threat of suppliers, the threat of purchasers and threat of substitutes.

Porter's fifth force that Porter describes is current rivalry among existing firms. In the specialty eateries industry,

The Porter`s five forces are threats of new entrants, the bargaining power of buyers ,product substitution and intensity of rival of rival among competitors .These forces measure the competitiveness of the market and also helps the company to identify strategies to use to penetrate such and gain market share.

Porter’s five forces are used to determine the competitive intensity and attractiveness of a market. These are close forces that affect a company’s ability to make a profit and serve customers. If any of these forces change, a company must reassess its marketplace. The five forces include: the threat of substitute products, the threat of the entry of new competitors, the intensity of competitive rivalry, the bargaining power of customers and the bargaining power of suppliers.

I am a registered nurse employed in a hospital in the healthcare industry. Porter’s five forces model begins with the first force being the intensity of rivalry among incumbent firms (Parnell, 2014). Competition in healthcare, particularly hospitals, is limited. Due to the accredidation process, government regulations such as a certificate of need (Certificate of need, n.d.) and licensing of facilities and providers, competition is limited. The Federal Trade Commission (FTC) is looking at ways to increase competition in healthcare such as opening up opportunities for nurse practitioners, increasing the availability of such technologies as telehealth and establish more competitive healthcare pricing. In cities, there is more of a concentration of competitors. The hospital that I work at is the largest between Memphis and Nashville and has the busiest ER in the state of Tennessee. Therefore, the concentration of competition is low for that particular hospital. There are high fixed costs with a hospital such as buildings, overhead, equipment, and salaried personnel. Yet, a hospital does not cut their prices to increase patient census. However, it could be questionable in a low census period as to whether there are additional tests run or hospital admissions that would ordinarily not happen if the census were higher. There is strong growth in the healthcare industry with the industry growing at twice the rate of the national economy (Health Care Industry, 2012).

Coca Cola is the largest company of the non-alcoholic beverages industry, controlling about 40% of the industry, followed by Pepsi with 20% control (Maverick 2015). Both companies are fully international, with a presence in over 200 countries, and are composed of numerous brands. Coca Cola, for example, owns about 500 brands, although the largest part of its profits stems from 21 of these brands. Overall, in 2016, the global non-alcoholic beverages industry was valued at $967.3 billion (Grand View Research 2017). Other key players in the industry include Nestle, Kraft Heinz Company, and the Pepper Snapple Group.