According to porter’s five forces model, ____ is low when customers have more options.
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Porter's Five Forces of Competitive Position Analysis was developed in 1979 by Michael E Porter of Harvard Business School. It's a simple framework for assessing and evaluating the competitive strength and position of a business organisation. It promotes the concept that there are five forces which determine the competitive intensity and attractiveness of a market. Porter's Five Forces helps to identify where power lies in a business situation. This is useful both in understanding how strong an organisation's competitive position is currently, and how it can achieve competitive advantage. According to Porter, a business has competitive advantage if, compared with its rivals, it operates at a lower cost, commands a premium price, or both. Strategic analysts often use Porter's Five Forces to understand whether new products or services are potentially profitable. By understanding where power lies, the theory can also be used to identify areas of strength, to improve weaknesses and to avoid mistakes.
The five forces are:
Arguably, the influence of regulation, taxation and trade policies makes government a sixth force for many industries. What benefits does Porter's Five Forces analysis provide?Five Forces analysis helps organisations understand the factors affecting profitability in a specific industry. This can help inform decisions about: whether to enter a specific industry; whether to increase capacity in an industry; and developing competitive strategies. Implementing Porter's Five Forces analysis? Questions to consider
What is low when customers have more options?Buyer power is high when customers have few choices and low when they have many choices.
What are the 5 Forces of M Porter's model?These forces include the number and power of a company's competitive rivals, potential new market entrants, suppliers, customers, and substitute products that influence a company's profitability.
What does Porter's Five Forces model determine quizlet?Michael Porter's Five Forces Model of Competition indicates that the five forces interact to determine the intensity or strength of competition, which ultimately determines the profitability of the industry and the probability of earning above-average returns.
What is Porter's 5 Forces used for?Porter's 5 Forces is an analytical model that helps marketers and business managers look at the 'balance of power' in a market between different organizations on a global level, and to analyze the attractiveness and potential profitability of an industry sector.
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