Porters 5 forces

Which of the following is NOT one of Porter’s Five Forces?

• Threat of new entrants

• Bargaining power of suppliers

• Marketing strategy

• Industry rivalry

What does the threat of new entrants depend on?

• Market demand

• Barriers to entry

• Number of existing suppliers

• Advertising costs

When buyers have high bargaining power, businesses may have to:

• Lower prices or improve quality

• Increase production costs

• Reduce the number of suppliers

• Stop selling their products

Which of the following increases the threat of substitutes?

• High switching costs for customers

• Unique product features

• Many alternative products available

• Strong brand loyalty

A strong brand and customer loyalty can help reduce:

• Industry rivalry

• Threat of new entrants

• Bargaining power of suppliers

• Market demand

If there are only a few suppliers in an industry, their bargaining power is:

• Low

• High

• Unaffected

• Dependent on customer demand

What happens when industry rivalry is high?

• Companies enjoy higher profits

• Businesses must compete aggressively

• Fewer firms enter the industry

• Supplier power increases

Which factor makes it easier for new companies to enter an industry?

• High capital requirements

• Strong customer loyalty to existing brands

• Lack of government regulations

• High economies of scale

The power of suppliers is strongest when:

• There are many suppliers in the market

• Substitutes for their products are widely available

• Their products are unique and essential

• Customers can switch suppliers easily

Porters 5 forces

• Yy

• Xx