How to Deal with Competitors in Five Forces Analysis?

Five Forces (Porter) | Five Forces Analysis
Knowledge Center

Forum

New Topic

hassan abdalla
Student (University), United Kingdom

How to Deal with Competitors in Five Forces Analysis?

Okay I understand the five forces, but when I'm trying to apply the model, where do I place other competitive rivals of the firm?
For example, if I am doing a five force analysis on supermarkets, in the competitive rivalry do I name other supermarkets like Tesco, Sainsbury's and so on or do I input the level of rivalry such as there are a lot of large dominating companies?
I do not understand the application of the model fully if someone can help?

  Bowdery
Teacher, United Kingdom
 

How to Deal with Competitive Rivals in Five Forces

Remember the model is concerned with the industry as a whole; the names of supermarkets are therefore not relevant. You shoud just analyse the intensity of rivalry generally.

  Bomo Albert-Oguara
Manager, Nigeria
 

Dealing with Competitors in Five Forces Model

The 5 forces model basically deals with those forces that create the interplay of firm rivalry and how these forces shape competitiveness in the particular industry. Since you are dealing with supermarkets, the 'industry' is then the distribution/retail chain and the immediate rivals in the supermarket sub-category are all firms, big and small, your small corner shop, grocers are all rivals.
The intensity however lies within the chains like Tesco, Sainsburys, M&S etc, etc.
Like Bowdery said, concern yourself only with the industry players at an aggregated level, not the individual firms. To do that, aks questions such as:
- What will constitute a barrier for a firm trying to enter the supermarket chain business?
- Considering that chains such as Tesco and Sainsbury are already there... How easy will a new entrant enter the market?
- What level of concentration exists in the supply side?
- Are existing chains also suppliers? In other words, what level of backward integration exists?
- Is the market oligopolistic or not?
- What is the level of product substitution in the supermarket chain business? You have Tesco cornflakes competing for shelf space with known brands like Kelloggs.
- Supermarket chains are known to control the supply chain of their fresh produce lines such as tomatoes,green pepper, fresh fruits and flowers; with most of them acting as value chain 'Governors'.
The complexity of the models lies in the fact that a lot of backward and forward integration takes place among the various players and this has blurred the lines of competition, thus making it more difficult for new entrants.

Start a new forum topic

 

More on Five Forces (Porter) | Five Forces Analysis
Summary
Forum
Evolution in Our Expectations of Business and Porter's Model
There are More than Porter's 5 Forces!
How to Deal with Competitors in Five Forces Analysis?
The Conclusion based on the Five Forces Model
The New Industrial Economics School
Why Porter's Monitor Consulting Company Failed
Does Competition Increase the Need for Segmentation?
🔥Porter's 5 Forces Framework in Non-competitive Situations?
Who is the Buyer in the Internet Industry?
Five Forces in Accounting Services Industry
Best Practices
Assumptions of the Five Forces model
5 Forces in the public sector
Apple Inc. and 5 Forces
5 Forces in Emerging Industries
Government as 6th Force in Porter's Five Forces
MEDIA as the 7th Force in Porter's Five Forces
Industry Analysis model
5 forces and supplier marketing
Porter's Five Forces is Excellent Tool
Basis of Five Forces Strategies
Substitution in the Five Forces Model
Business Networking: Forces are Getting Connected
How does Information Technology alter Porter's 5 Forces
Bargaining Power of Buyers. Examples
5 Forces Model Limitations
Porter 5 Forces and E-Commerce
Measuring / Calculating the Five Forces of Porter?
Special Interest Group

Do you have a keen interest in Five Forces (Porter) | Five Forces Analysis? Sign up for free

Notify your students

Copy this into your study materials:

and add a hyperlink to:

Link to this discussion

Copy this HTML code to your web site:

Five Forces (Porter) | Five Forces Analysis
Knowledge Center



About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
2021 12manage - The Executive Fast Track. V15.8 - Last updated: 24-7-2021. All names of their owners.