Steel Industry Essay examples

619 Words Oct 25th, 2013 3 Pages
1. Using the information contained in the case, conduct a five-forces analysis of the U.S. Steel industry. What conclusion can you draw from this?
Degree of Rivalry: Mini mills were being used by the foreign competition which mean they were able to produce steel at less expensive rates passing that on ot their customers.
Barriers to entry: Starting in the 1970's since there were no trade barriers companies overseas were able to manufacture and sell steel for a much lower price here in the United States therefore affecting companies domestically.
Supplier power: Once steel became needed again suppliers were able to multiply what they charged consumers and were able to produce large qantities at a time in order to stay up with demand.
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The level of the competition does vary thuogh because mini mills are able to produce steel less expensively yet they are not able to produce in large quantities as the bigger established steel companies. Each company needs to look at how they can improve within themselves, the economy and against the competition.
3. Given the nature of competition in the U.S. steel industry, what must a steel maker focus on in order to be proftable?
The U.S. steel industry would have to focus on technology. It should also focus on the larger global scale in order to stay up with competition domestically and internationally. If this does not happen then the United States will not be able to stay ahead of the competition and many companies will once again go bankrupt.
4. How is the competitive strategy of the steel industry currently being affected by the seven macro-environmental forces?
It is currently being affected economically, technologically and legally. With the economy being as low as it has and going through a recession many industries have not been able to stay open. They have needed to cut back on expenses such as supplies and employee costs. With new laws constantly passing they need to make sure they are up to date with minimum wage and tax laws. It all factors in to whether or not a business can stay open and make a profit at the same time.

Hill, C. W. L., & G. R. Jones. (2013). Strategic management: An integrated

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