The 3 C’s (Company, Customers, Competition)
|Company||Cost structure, break-even, capacity utilization, cost compared to competitors, financial resources, company and product fit, core competencies|
|Customers||Who are they, how are they different (segmented), what is the level of competitive intensity in the industry, what channels do they use, how are products differentiated|
|Competition||Who are they, how are they different, what are competitive market shares, is the industry fragmented, what is the level of competitive intensity in the industry, what channels do they use, how are products differentiated|
The 4 Ps’ (Product, Price, Promotion, Place)
Porter’s 5 forces model
The Five Forces model of Porter is an Outside-in business unit strategy tool that is used to make an analysis of the attractiveness (value) of an industry structure. The Competitive Forces analysis is made by the identification of 5 fundamental competitive forces:
- Entry of competitors. How easy or difficult is it for new entrants to start competing, which barriers do exist.
- Threat of substitutes. How easy can a product or service be substituted, especially made cheaper.
- Bargaining power of buyers. How strong is the position of buyers. Can they work together in ordering large volumes.
- Bargaining power of suppliers. How strong is the position of sellers. Do many potential suppliers exist or only few potential suppliers, monopoly?
- Rivalry among the existing players. Does a strong competition between the existing players exist? Is one player very dominant or are all equal in strength and size.
Sometimes a sixth competitive force is added:
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