OUTLIN
E
The objectives of industry analysis
From environmental analysis to industry analysis
Porters Five Forces Framework
Applying industry analysis
Industry & market boundaries
Identifying Key Success Factors
The Objectives of Industry
Analysis
3 key influences:
The value of the product to customers
Perfect
Oligopoly Duopoly Monopoly
Competition
Product Homogeneous
Differentiation Potential for product differentiation
Product
Perfect
Information Imperfect availability of information
Information flow
Porters Five Forces of
Competition Framework
SUPPLIERS
Bargaining power of suppliers
INDUSTRY
COMPETITORS
BUYER POWER
Buyers price sensitivity
Relative bargaining
power
BUYER POWER
Buyers price sensitivity
Relative bargaining
power
Threat of Substitutes
Capital requirements
Economies of scale
Absolute cost advantage
Product differentiation
Access to channels of distribution
Legal and regulatory barriers
Retaliation
Bargaining Power of Buyers
25
20
15
10
0
Return
Return onon sales
sales Return
Return onon investment
investment Cash
Cash flow/Investment
flow/ Investment
-5
Less than -5% < -5%
-5% to 0-5% to 00 to 5%
0 to 5% 5% to10%
5% to 10%> 10% Over 10%
ANNUAL RATE OF GROWTH OF MARKET DEMAND
The Impact of Unionization on Profitability
ROI (%) 25 24 23 18 19
Pre-requisites forsuccess
Pre-requisites for success
Analysis of competition
Analysis of demand
What drives competition?
Who are our What
What are
drives
the competition?
main
customers? What are the
dimensions of main
competition?
dimensions of competition?
What do they want? How
Howintense
intenseisiscompetition?
competition?
Howcan
How canweweobtain
obtainaasuperior
superior competitive
competitive position? position?