Applying Porter’s Five Forces Model to Evaluate Competitive Forces in a Market Sector

Business Strategy

P3.Applying Porter’s Five Forces model evaluate the competitive
forces of a given market sector for an organization.
To analysis the framework of a company's competitive
environment porter's five forces analysis is being used. The five
forces are bargaining power of supplies, threat for substitute
products, threat of new entrants, bargaining power of buyers and
rivalry among the existing players. These five forces analysis can
help the company to build on its packaging goods and processing
to have an advantage in competitive market (Thompson,
Strickland and Gamble, 2015). To not just build upon its
packaging goods or processing these five forces can also help in
the sector of whole consumer goods and profitability.
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19

Bargaining Power of Supplies-
There are numerous suppliers of raw material of an
organization. Due to suppliers the company will have to put their
price accordingly. If the suppliers demand higher price for raw
material, then the sells will reduce due to the increase in price.
The company to have an efficient supply of good then Kellogg's
should have multiple suppliers. They should experiment with
different raw materials so that if the price of one raw material
goes high then the company can shift to the other supplier.
Suppliers who are fully dependent on Kellogg's company should
be given more preference to because they lose there bargaining
power and this will give more profit to Kellogg's. This
understanding of weaker supplier has been learnt from Nike and
Walmart's mistakes.
12/10/
19