Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Business CS > UNIT 7 porters 5 forces model > Flashcards

UNIT 7 porters 5 forces model Flashcards

1
Q

what does porters 5 forces provide

A

simple framework for assessing and analysing competitive strength and position of an organisation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

porters 5 forces can be used for good analytical effect with what other models

A

pest-c
SWOT

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Porters 5 forces model provides suggested points under each heaidng which managers cna use develop

A

a broad analysis of comp position which might be used when creating strat plans or making I descisons about bs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

what are the five forces

A

power of buyers
power of suppliers
threat of new entrants
competitve rivalry
threat of substitutes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

if firm faced same comp pressures in all mkts then how would profitability e.g ROCE be

A

very similar

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

what can be explained to some extent through the analysis of diff competitive environments

A

why some industries have hig profits but others have low profits

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

state the 5 characteristics of high profit industries

A

mild comp between bs

suppliers w little power
customers having little power

little threat of sub products being developed
no rela prospect of new entrant to industry

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

state 5 likely characteristics of low profit industries

maybe low prof cuz so many so take up tiny parts of mkt share between them

A

intense rivalry between bs

very powerful suppliers
customers with considerable power

imminnent threat of develop of sub g/s
highly likelihood of new entrants to mkt

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

when was it developed

A

1980s

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

what does ocmpetitive envio refer to

A

mareket structure and teh dynamic system in whihc a business competes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

what are teh 5 forces

A

THREAT of new enyrats

bargaining power of buyers

threat of subsitute products or services

bargaining power of suppliers

rivalry among existing compeitiros

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

entry threat relates to

A

barriers to entry

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

ENTRY THREAT - its not just exosting firm in industry that may pose a threat it can alos come from

A

new entrats to the inustry

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

ENTRY THREAT - what are the 5 barriers to entry

A

cost of entry

governemnt barroers

patents

economies of scale

access to suppliers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

ENTRY THREAT - give an example of industry eith high cost to enter

A

aircraft manufacturere

oil company

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

ENTRY THREAT - government legislation can sometime s inhibit

A

a new entrant

highly regulated industries will find that incumbents have fine-tuned their business according to regulation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

ENTRY THREAT - What do patents give the holder

A

a competitive advantage whihc may make it more difficult for a new entrant to access a market

as cant copy certain ideas, images

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

ENTRY THREAT - economeis of scale

A

if you cant benefit from them or quickly could acts as a barreir to entry

cuz firms have low cop and may ue this to give lower prices to customers

or may be getting higher profit margins meanign can for example reward theri staff or provide more training to make em competitive

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

ENTRY THREAT - access to suppliers

A

lack of easy access to suppleirs is a potential barrier

as cant employ tactics such as JIT ? askkkkk

20
Q

ENTRY THREAT - market is easier to access when what 4 things are apparent

A

weak brand loyalty

easy access to suppliers

common tech available

low threshold to EOS

21
Q

WHAT DOES buyer power relate to

A

impact customers have on a business

22
Q

when is buyer power likely to be high

A

fewer customers more numerous the suppliers

23
Q

to sum up when is buyer power more likely to be powerful

A

few buuyers and or buys a significant proportion of ouptut

buyers have a credible backward integration threat

24
Q

to sum up when is buyer power more likey to be weak

A

many buyers

producers have a credible forward integration threat

singificant switiching costs

25
Q

long lsit

what type of product would make buyer power strong and why , what may they look fr

how can we compete if got low buyer power and what are hte impacts

how can we get over prolem of low buyer pwoer (5 ways + considerations)

A

homogenous products as lots of witiching may occur - who can they get better deal from

so you may have to compete on prices whihc reduces rev and profits

or can try offer better quality but higher costs and lower profits at least in the short run

to get over it try differnetiate products and position it differnetly in the mkt - but may lead to cost issues

create a buyer group - clump togehter with otehr bs in your industry so you can make fewer seller

find new customers/ segments which means there are more buyers

increase marekting like promotion and adv

start price war as leads to less seller sin mkt , improving leverage when comes to buyers

26
Q

any producing bs requires

A

suppliers

27
Q

any producing bs requires supplier which necestates

A

relaitnoships with suppleirs

28
Q

if supplier are powerful more likely to be able to

A

exert influence on the producing business

29
Q

when are suppliers more lieklt to be poweful

A

business uses single suppleir

credible forward inegration threat by suppliers

customers are powerful ????

high cost to switch suppliers

30
Q

when are suppliers more lieklt to be poweful

4 reaosns

A

business uses single suppleir

credible forward inegration threat by suppliers

customers are powerful ????

high cost to switch suppliers

31
Q

when are suppliers more likely to be weak

A

many competitive suppliers

credible backward integration threat by purchasers

customers are weak

low cost to switch suppliers

32
Q

what startegies can we use to get lower supplier power over us

A

lock in longer contracts with suppliers and guarantee your purchasing wiht tehm - may lead to them negotioating a better deal for you lowering your costs

max EOS drive up output , to bring down ACU, switch from JIT to JIC

offer to merge with them - be forward vertical interation partner which guarantees a poitn of sale for suuppliers

33
Q

a bs ability to achieve profitability is affected by threat of

A

substitutes

34
Q

why is a bs ability to ahcieve profitability affected by threat of substitutes

A

gives consuemrs ability to choose alternative product

35
Q

what is a substitute product

A

one from another industry or bs that offers similar benefits to the one produced by a particular business

36
Q

give examples of substitutes

A

bottles provide alt to cans

airlines provide alt to trains

e readers usb fro printed boos

37
Q

good applicaiton of substiteus

A

as internete become a thing e books a thing whihc threatens book stores /puts pressure on them to adapt to change

38
Q

threat of substitiues is simply the questino of

A

are there alternatives for consumers within your industry can they go to anotehr indsustry to get simliar product

39
Q

if ive got losts of substitiutes why is that bad

A

lower your demand whihc may lad ot gfact you need to lower prices

problematic for liquidity
and profit

40
Q

startegies to lower substitute threat

4

A

Porter generic stargy - lower prices ot avoid switching - cost leadership

create better brand loyalty - through more mkting

meet customer needs evenbetter than you do - means mkt research

build a moa around customers through something like prime - but unique and hard to do

41
Q

rivalry is about how much

A

competition do you have

42
Q

lots of competiiton is bad as

A

you may need to reduce prices

impacts on rev and cashflow

43
Q

what are the 2 startegies to overcome intense rivalry

A

PGS cost leadership /differentaition

go all tu with marketing to ensure on top of ocmp but ££££

44
Q

importance of P5F to managers in exising industr

A

help define strategy - if youc an define it you knwo where to postion yourselves and what youre value proposition is

if defined stargety and ocmm to employees - youre aligned as a bs and working towards same goal

45
Q

potential bs looking to enter prtclr industry - value of PF5 for managers

A

look at it to see profitablity of industry and se whther if its even worth entering

46
Q

in terms of number and sie of firms when is ribarly more likel

A

Business CS (24 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions