Maytag Strategic Analysis

Competitive environments are defined by the identity, track record, financial strength and market share of key competitors. Harvard Professor Michael Porter 's Five Forces model can be used to evaluate a company 's competitive position. These five forces are barriers to entry (the ability of new players to enter the market), buyer power (the ability of customers to influence price),

Porter's Five Forces is a simple but powerful tool that consist of 5 different forces to understand the competitiveness of your business environment, and for identifying your strategy's potential profitability. The five forces are degree of rivalry, threat of entry, threat of substitutions, buyer power, and supplier power. Each force is helpful in their own way to get to know your rivals a lot better and get to know what can happen in your market.

At its core, Porter’s 5 forces describes a firms overall ability to compete in a market. We discuss our analysis of the 5 forces and how they affect SAS Corporation and its stakeholders. Please examine Figure 1.1 to view a diagram that depicts the 5 forces.

Porter’s Five Competitive Forces Analysis is a framework developed by Michael E. Porter of Harvard Business School for study of industry analysis by analyzing five competitive forces which define industry and its business strategy. These five competitive forces determine the competitive advantages, disadvantages and attractiveness or profitability of industry.

The Porter’s five forces is a competitive position analysis and business strategy format created by Michael Porter in 1979. The premise behind the format is to provide them with five forces that shape every industry. Mr. Porter 's theory is that if a company analyzed the information received from reviewing the five forces, the company would be able to compete in a higher fashion against its competitions. Following the five forces would allow a firm to determine the type of market or industry it is operating in. Each of the five works as an individual factor in the microenvironment, but one force could not exist without the out force in a stable economy. The five forces are Supplier Power, Buyer Power, Threat of substitutes, the threat of new entrant and Competitive Rivalry. Three forces affected the market horizontally while two affected, it vertically from each side. A review of the movie rental market from the Porter’s five forces.

We chose the Porter’s Five Forces as a valuable analysis tool as it helped us to identify the potential threats from new entrants as well as the power that the buyers have over the sales in this industry. It also helped us to identify the amount of competitiveness within the industry and how easily other products could be substituted for our products.

Porter’s five forces analysis is a tool is useful for us to analyse the threat of competition in an industry. Porter believed that the industries were influenced by five forces; competitive rivalry, threat of new entrants, bargaining power of suppliers, bargaining power of buyers, and the threat of substitutes. Analysing these areas can allow you to see attractiveness of the market and find a competitive advantage.

1) With reference to your own organisation, explain how Porter 's 'Five Forces ' theory might apply to the industry that it works within.

3)In response to some of these opportunities, Maytag faced a number of threats. For example, because they increased sales through uncontrolled marketing strategies of subsidiaries, the decisions were not controlled by the corporation, resulting in overspending as well as criminal exposure and charges of deception. The media also greatly publicized the weaknesses of the company which threatened their number of future consumers.(T)

The Porter Five forces analysis helps the marketer to contrast a competitive environment. Porter’s five forces model is comprised of following five completive forces:

Slide 2: Michael Porter's five forces framework allows us to determine the pricing power within a given industry, and can be tailored to an specific firm within that industry. The five forces are bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitutions, and the intensity of rivalry within the industry.

Application of Porter’s five forces analysis focuses on industry and market analysis, measuring key elements of a relevant market environment and ultimately how healthy that market looks for a business. These key forces include buyer power, supplier power, threat of new competitors, threat of substitution, and existing competition. Where competition is fierce, market size low, supply chain weak, competition aggressive and plentiful, pricing and margins low, it’s likely this market would be considered unhealthy for a company to enter. The fewer or lesser such items, the healthier a market might be and more likely to be considered by a company.

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” model focuses on business’ external environment where many factors influencing the success of companies, including industry rivalry, competition from new entrants, substitute products, bargaining power of buyers, as well as suppliers. (See Figure 1.).

Porter’s Five forces analysis looks at five key areas mainly the threat of entry, the power of buyers, the power of suppliers, the threat of substitutes, and competitive rivalry (advantage).