Contents
       Porter’s five forces – Competitor analysis
       Porter’s generic competitive strategies
       Porter’s model of competition – Risks and Threats
       Assessing the balance of power in a business situation
       Porter’s competitive advantage
  Porter’s five forces
               
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   Threat of new entrants
     The easier it is for new companies to enter the market, greater are the chances of a fierce cut-throat 
     competition. Factors that can limit the threat of new entrants are known as barriers to entry
             Existing loyalty to major brands                      Brand equity
            Incentives for using a particular buyer               Switching costs or sunk costs
            (such as frequent shopper programs)
            High fixed costs                                      Capital requirements
            Scarcity of resources                                 Access to distribution
            Government restrictions or legislation                Absolute cost advantages
            Entry protection (patents, rights, etc.)              Learning curve advantages
            Economies of product differences                      Expected retaliation by incumbents
  Competitive rivalry
   Competitive rivalry amongst companies sometimes extends to non-price 
   dimensions as well like innovation and marketing amongst others
                                  Rate of              Level of 
                                 industry            advertising 
            Number of             growth               expense           Diversity of 
           competitors                                                   competitors
                                                      Exit Barriers 
     Fixed cost           Intermittent                                      Informational 
     allocation             industry                                       complexity and 
     per value            overcapacity                                       asymmetry
       added
  Influencing the power of five forces
       ••                  ••                  ••                  ••
   Reducing the        Reducing the  Reducing the         Reducing the      Reducing the 
   Bargaining          Treat of New  Competitive          Bargaining        Threat of 
   Power               Entrants        Rivalry between  Power of            Substitutes
   of Suppliers                        Existing Players   Customers