Michael Poters Frame Work

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MZUMBE UNIVERSITY (CHUO KIKUU MZUMBE) SCHOOL OF BUSINESS DEPARTMENT OF BUSINESS STUDIES MBA- CORPORATE MANAGEMENT BUS 5021 Strategic Business Management. GROUP ASSIGNMENT 1. GROUP MEMBERS S/No.NAME 1. BERTHA MARERE 2. CELESTA KAGWI 3. ERASTO NZOTA 4. MARIA KALUSE 5. AZIZA ABDULRALMAN 6. AGNESS KILINDO 7. JOHN SIULAPWA 8. HENRY MFUMU 9. PAUL HUMBI 10. WAKIBARA NGETA DATE OF SUBMISSION: FRIDAY 16/11/2013. TABLE OF CONTENTS 1.0. INTRODUCTION. 1 1.1. The Mobile phone Industry of Tanzania 1 2.0 .PORTER’S FIVE FORCES FRAMEWORK MODEL, PFFF 1 2.1. Degree of rivalry among existing firms. 2 2.2. Threat of substitute Products or Service. 3…show more content…
Michael Porter provided a framework that models an industry as being influenced by five forces (Porter, 1980). Theseinclude the threat of new entry, the threat of substitutes, and the power of buyers, the power of suppliers and competitive /Degree of rivalry. Figure 1 provides details of the framework Threats of New Entrants Figure 1. Porters Five Forces Framework. BargainingPower of Buyers Bargaining Power of Suppliers Degree of rivalry among existing firms Threats of Substitute Products SOURCE: Porter, M E. (1980) A discussion of each component of the model is as follows: 2.1. Degree of rivalry among existing firms. Competitive rivalry is organizations with similar products and services aimed at the same customer group. The degree of rivalry among the competing firms is affected by a number of factors. These include: * A larger number of firms increase rivalry because more firms must compete for the same customers and resources. The rivalry intensifies if the firms have similar market share, leading to a struggle for market leadership. * High fixed costs result in an economy of scale effect that increases rivalry. When total costs are mostly fixed costs, the firm must produce near capacity to attain the lowest unit costs * Low levels of product differentiation are associated with higher levels of rivalry. Brand

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