Swot, Pest, Porte's Five Forces Analysis

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:

Threat of New Entrants - The easier it is for new companies to enter the industry, the more cutthroat competition there will be. Factors that can limit the threat of new entrants are known as barriers to entry. Some examples include:

Threat from Suppliers: Suppliers are at a disadvantage in the current market. There are more suppliers than businesses to purchase them which weights the power to Company G. Company G has numerous options in suppliers who compete for our business. Company G will need to secure two new suppliers for parts components before it can begin production.

Potential for new entrants - The primary prevention to entrance are higher barriers within industry with the threats of new entrants as competitors (Porter, 1998).

Threat to new entrants: There is no barrier to entry in this industry but it might be difficult for newcomers to compete against existing well establishing companies.

Bargaining power of suppliers: This force analyzes how much power a business 's supplier has and how much control it has over the potential to raise its prices, which, in

The SWOT analysis gives organisation the opportunity to evaluate issues within and outside the business. It is the method of evaluating the strengths, weaknesses, external opportunities and threats from competition, and also to identify some strategic decision-making (Colbert 2018).

SWOT Analysis is a simple but useful framework for analyzing your organization's strengths and weaknesses, and the opportunities and threats that the company face. It helps you focus on your strengths, minimize threats, and take the greatest possible advantage of opportunities available to you will giving you the opportunity to ward off possible threats from external sources.

Porter (1980) emphasized that suppliers to an industry may be powerful if they are more concentrated than their customers and their customers do not command a significant share of their business because their customers do not represent a potential long-term or major relationship, for example, one-off or small customers versus regular or bulk buyers.

The risk of generic substitution is also increasing with especially China dominating the production market. Customers will substitute for a generic product if the disposable incomes of the customers reduce resulting in customers willing to trade down for a inferior but cheaper product.

The threat of new entrants refers to the threat posed by new competitors within an industry. If it is easy for new firms to enter the industry barriers to entry are low and the threat of new entrants is high. A profitable industry attracts more competitors. Economies of scale, learning curve effects and other macro factors impact the nature of an industry 's

Buyers have more power when they are large-volume buyers, the product is a significant aspect of the buyer's costs or purchases, the products are standard within an industry, there are few switching costs, the buyers earn low profits, potential for backward integration of the buyer group exists, the product is not essential to the buyer's product, and the buyer has full disclosure about supply, demand, prices, and

SWOT analysis is a useful tool for understanding and decision-making for all sorts of situations in business and organization. SWOT analysis can be classified into internal and external factors affecting a company. The Strengths and Weaknesses of the SWOT analysis represent the internal factors that influence the viability of the company. While the Opportunities and Threats, on the other hand, are the external factors that may affect the company's performances. A SWOT analysis provides more understanding of the organization in relation to its internal and external environment so that manager can formulate better strategy in pursuit of its mission.

The threat of new entrants: According to our text, the threat of new entrants is the possibility that the profits they make in an area may be eroded by new competition. The McDonald’s by me competes with Burger King, Wendy’s, Dairy Queen, and other smaller places like Zel’s. Each time a new place opens the less business they will have. For the other company, there will be a barrier to entry. They will have to use product differentiation to bring in the customers…to make them overcome their loyalty to McDonald’s (Dess, p. 53).

If an industry is profitable, it will become a magnet to attract more competitors looking to do same business with us. If it is easy for these new entrants to enter the market, this poses a threat to the firms already competing in that market. Threat of new entrants is one of the forces that shape the competitive structure of an industry (Marc, 2014). A high threat of entry means new competitors are attracted by the profits of the industry and can enter the industry easily. New competitors entering the marketplace can make the market share and profitability of existing competitors more threaten cause the existing competitor to make some changes to existing product quality or price levels. A high threat of new entrance can make an industry more competitive and decrease profit potential for existing competitors whereas a low high threat of new entrance can make an industry less competitive and increases profit potential for the existing