Five Forces Analysis Worksheet

1566 words 7 pages

Exhibit III-1 Five Forces Affecting Industry Structure
ENTRY BARRIERS Economies of scale Proprietary product differences Brand identity Switching costs Capital requirements Access to distribution Absolute cost advantages Proprietary learning curve Access to necessary inputs Proprietary low-cost product design Government policy and international treaties Expected retaliation RIVALRY DETERMINANTS Industry Growth Fixed (or storage) costs/value-added Intermittent overcapacity Product differences Brand identity Switching costs Concentration and balance Informational complexity Diversity of competitors Corporate stakes Exit barriers Strategic alliances (domestic & international)

Threat of New
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What accounts for their power? What can be done to neutralize their power? If your suppliers are powerful, do not assign a star. Consider both domestic and international aspects/influences, as well as strategic alliances. Your Rating:

Detailed Analysis of the Power of Suppliers
Factor Concentration of suppliers Explanation If a type of supplier selling to your industry is concentrated, they may exert more power – influencing prices, terms, and quality. If your suppliers’ income in closely tied to your business, they may offer you better pricing to keep their business. If suppliers provide essential inputs to you, they will wield great power. If your supplier feels your firm is “locked in” due to the uniqueness of the supplier’s products, it may exert more power. If your supplier’s product has many substitutes, they may offer price concessions to prevent you from leaving. If your supplier has the ability to join your industry, it may use this threat to demand better prices. Your Industry

Importance of this industry to your supplier group

Importance of product relative to purchases in the industry Supplier’s products are differentiated or have high switching costs Availability of substitutes

Supplier group can pose threat of forward integration



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