PORTER’S FIVE FORCES - THREAT OF SUBSTITUTES

Question 1

What is the threat of subsidies

Answer 1

The extent to which other products are unable to satisfy the needs of an organisation’s customers

If a customer has £5, what’s stopping that customer from going to a different restaurant, or buying a completely different dish which isn’t on another competitor’s menu.

Question 2

What is the impact on functional/ strategic decisions:

Answer 2

Marketing - Increase market research into consumer needs
Finance/ operations - invest in specialist equipment
HR - Train employees with unique skills and attributes