Porter’s Five Force Model for Nissan Motors UK

Porter’s five force model
Nissan Motors UK

Nissan Motors UK 2
Contents
Introduction................................................................................................................................3
Porter’s five force model............................................................................................................3
Bargaining power of suppliers................................................................................................3
Bargaining power of buyer’s..................................................................................................3
Threat of new entrants............................................................................................................4
Threat of substitution..............................................................................................................4
Competitive rivalry.................................................................................................................5
References..................................................................................................................................6

Nissan Motors UK 3
Introduction
Nissan Motors is a leading automobile company headquartered in Japan. The company was
founded in 1933 under the Nissan Group. Since 1999, the brand is a part of the Renault-
Nissan-Mitsubishi alliance. Nissan is the world’s largest manufacturer of electric vehicles and
the sixth largest automaker in the world (Bhatia, 2016). Since, the inception the brand has
delivered quality products and set the right positioning in the minds of its consumers. This
report highlights upon the five forces of porter that are effectively working with the brand in
UK.
Porter’s five force model
Porter’s five force model is a strategic tool that allows firms to understand the intricacies of
the industry in which they function (David, 2011). The model aims at understanding various
forces that work upon a brand in its existence. Porter’s five force model for Nissan Motors in
UK is as below:
Bargaining power of suppliers
There are various suppliers that every organization needs to coordinate with. Any brand in
the automobile industry procures material from various suppliers. It would be impossible for
a brand to make a final product without the products offered by these suppliers. This gives
the suppliers of the brand certain power. Bargaining power of suppliers plays a critical role in
strategic management of any brand (Hill, Jones & Schilling, 2014).
A car is a complicated product and in order to ensure the quality of the product, it is
imperative that all the parts of the car are bought from effective quality suppliers. Nissan has
a large number of suppliers who efficiently coordinate in building a fine quality product.
Nissan suppliers have a Moderate power as the brand name of the firm is strong enough to
attract new suppliers. Associating with such a strong brand adds to the goodwill and market
positioning of the suppliers.
Bargaining power of buyer’s
Every brand has a large number of buyers. This is because every business runs on the simple
concept of demand and supply. If the demand is too high, the prices of a product go up. The