Porter Five Forces Analysis of Mercedes

Added on - 05 Jun 2020

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PORTERS 5 FORCES ANALYSISOF MERCEDES
Table of ContentsINTRODUCTION...........................................................................................................................1TASK...............................................................................................................................................1Porter's five model.......................................................................................................................1Application of model...................................................................................................................1Ethical issues...............................................................................................................................2Benefit and challenges of working as team.................................................................................3CONCLUSION................................................................................................................................3REFERENCES................................................................................................................................4
INTRODUCTIONPresent study is based on Mercedes, it is the global brand that offers high qualitypremium auto mobile products to consumers globally. Current assignment will explain porter'sfive forces of Mercedes (Rothaermel, 2015).TASKPorter's five modelPorter's five forces is the strategic analyses tool that helps in analysing competitive forcesand identifying strategies of the firm in effective manner. It focuses on five main competitiveforces that influence overall working of industry significantly (Yunna and Yisheng, 2014). Theseforces are: competition, threats to new entrants, power of suppliers, power of customers, threatsto substitute products.Application of modelSupplier bargaining powerAuto mobile industry is the big industry where power to suppliers are betweenlow to medium. Mercedes requires many kinds of raw material such as hardware parts etc. inorder to manufacture a quality cars (Pisano, 2017). In this respect cited firm makes connectionwith mass suppliers. There are many suppliers those which provide these raw material to theMercedes. If one supplier offer raw material at high cost then entity can move towards othersuppliers. Thus, power of suppliers is slow. Mercedes has developed strong relationship with itssuppliers that helps the cited firm in conducting its operations in smooth manner.CompetitionThere are many competitors of Mercedes such as Audi, Toyota etc. All these are globalbrand and are offering high quality products to consumers. Ion such condition rivalry amongexisting competitors is high in the Mercedes (Sölvell, 2015). Cited firm has to face hugecompetition that creates difficulty for the entity to sustain in the market for longer duration. Inorder to face this competition cited firm has to make modification and have to implement thelatest technologies so that it can gain competitive advantage in the market.Bargaining power of buyersPower of consumers is medium to high, consumers have variety of choice and they canbuy smilier products from other firm (Ortega, Jalón and Menéndez, 2014). Though, Mercedesoffer high quality premium products as per the needs of consumers thus, people are very satisfied1
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