Porter’s Five Forces Principles Essay
Porters five forces is a model in strategic management through which you can develop an understanding of the underlying business principles. Students doing management courses should develop an understanding of every component of the porters five force model. It is a model which every management student feel like they should understand. But many of college-going students of UAE are not aware of the porters five force model.
College going students starting their case interview preparation procedure or preparing for the job it is very much crucial for them to gain knowledge about industry or market. Students often have a question on how to start an essay. If you are writing the essay on porter five forces then you should start your essay by writing porters five forces definition. Below is a sample which you can use for writing an essay. But still, If you are struggling to write an essay then you can avail essay writing help from us. By filling the form and placing an order you can get your assignment complete by experts.
Porter’s five forces is basically a framework which helps companies in clearly analyzing their competitive strategies. It assists companies in determining the strength of different competitive forces. By applying the porters five force model you can easily determine the long term business profitability and level of competition in the industry. Developing an understanding about competition and determining how your business stacks up against their marketing strategies, is essential for any organization’s success. At the time of utilizing porters, five forces in business students should determine the nature of the industry. After developing understanding about underlying principles students can easily abstract extract insights from the model that fits into your unique condition and apply them to your business.
By using the specific model you will be able to properly analyze the business problem. The essay mainly emphasizes on analyzing the effect of different forces on business. An essay also includes an explanation on porters five forces these are the threat of new entrants, the threat of substitute, the threat of rivalry among the existing firm, bargaining power of buyer and suppliers.
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Components of Porters five forces
Many students face issue in applying the five forces then don’t worry you can take marketing assignment help from our experts. The 5 key forces which shape the market competition are:
The threat of new entrants
The threat of entry of a new firm in an industry is completely dependent on the number of barriers. According to the porter, there are basically six barriers to entry these are:
Economies of scale
The decrease in unit costs of goods might force the new firm to enter on a large scale and risk a strong reaction from firms already in the industry,
Requirement of capital
The requirement of huge capital may restrict a firm from entering into a specific industry.
High switching costs
It is a cost which the buyer has to bear from switching from one supplier to others.
Existing companies have already has been successful in gaining customer loyalty and in capturing market share. It would be quite difficult for a news organization to attract customers and capture market share. Existing enterprises already have product technology, access to raw materials, favourable sites, advantages in the form of government subsidies, and experience.
Bargaining power of suppliers
Suppliers have a great influence on the industry. They can completely control the increase or decrease in the quality and price of products. As per porters five forces model a supplier group exerts even more power over an industry if it is dominated by a few enterprises.
Bargaining power of buyers
According to porter five forces, bargaining power of buyer is high when there are a number of companies in an industry is selling the same products or services. In case there are a number of firms selling the same goods then the buyer can force companies to reduce the price of goods.
The threat of substitute in porters five forces model
Substitute goods are a result of competition in the industry. Launch of the substitute products can have an adverse influence on the profitability of enterprise selling similar products.
The intensity of competition among rivalries
Competition and rivalries between firm competing in the same market or industry develop automatically. Competitors by using unique strategies such as advertisement, the launch of new product attract customers. Companies by implementing unique marketing strategies try to achieve a leading position in the market. They also intend to increase their market share. According to porter five forces model, the intensity of this rivalry is the result of factors like slow growth within an industry, and the high risk of industry exit. There are also market entry barriers.
Note: This is just a sample of essay on porter five force model. But when you are writing a complete essay then you should include porters five fore model example. It is the tactics which will help you in achieving good marks for the essay.
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