Analysis of Qantas Airways using Porter's Five Forces Model

STRATEGIC MANAGMENT

Contents
Introduction............................................................................................................... 3
Summary of porter’s five forces model............................................................................. 3
Application the model.................................................................................................. 4
Usefulness and limitation.............................................................................................. 5
Conclusion................................................................................................................ 6
References................................................................................................................ 7

Introduction
Qantas Airways is a leading Australian organisation in the airline industry. This Airway is
listed on ASX (Australian stock exchange). This essay brings out a discussion on Qantas
Airways and its analysis through Porter`s five forces model. In addition to this, the essay has
also recommend some future strategies to grow in future. Initially, the model is defined
appropriate properly then it is applied on Qantas airlines (Hannigan, Hamilton III, &
Mudambi, 2015).
Summary of porter’s five forces model
Porter’s five forces model is a tool, which is used to comprehend the competitiveness of the
business situation and recognize the strategic prospective of profitability. Porter five forces
was created by Michael in 1979 and become one of the popular and highly regarded tools
(Riasi, 2015).
Competitive rivalry- When the prices are intense then companies attract customers with
competitive price cut and great influencing marketing tools. On the other hand, if the
competitive rivalry is low then organisation will earn tremendous profits (Riasi, 2015).
Threat of new entrants- This factor determines how easily a new organisation can enter the
market. If the industry is profitable, more organisations will enter the market and the
profitability of each organisation will fall. Hence, the important for the existing organisation
is to generate huge barriers in order to enter so that it can deter new entrants (Riasi, 2015).
Bargaining power of suppliers- robust bargaining power of suppliers will trade its prices at
high or low to its buyers. Few suppliers in the industry will have high prices. Negotiating
power of buyers is described as when buyer has the power to ask for lower prices or the
higher prices than the customer`s bargaining power of buyers is high. Threat of substitutes is
describes as force threatens where buyers easily can find substitute products, which will