Studio 3 – Porters 5 Forces


Porters 5 forces is an analysis about the competition of a company. 5 Forces is all about analysing the competition and is a business strategy for the development of the company. money wise. IT is to develop levels of financial stability. This analysis draws on five key points, in which i will discuss within this blog.



The main key point within the porters five forces analysis strategy is the competition. In most diagrams, this point is shown in the centre of the diagram as it is the linking element. This is because competition links to all other elements. This is looking at all existing competitors and how many potential ones there is and will be. Looking at the suppliers and how they supply to the competitors.


Customer Power

As customers are very important for business and money making, the customer power is the element that spaces itself out in the flow of the chart. This one is about the pricing of what you produce and what content you provide for customers.  looking at the pricing of what it would take for the customer to switch companies. The more smaller and powerful the army of clients is the more power it has.



This section is about the power that suppliers ‘supply’ on the impact of business. Suppliers can easily raise the price of products and make life harder for the business relating to this. This is to see how much it would cost to split the supplier and move to another. ‘The power of suppliers’, which they do hold a lot. They can make the company depend on them, which would not be a good thing.


This topic is about the customers and how easy it could be for them to switch to another competitors. This point looks at other competitors and how they tend to their customers with costs. Looking at the costs all together for customers to be able to switch to another company. If the risk is too high, the customers will not substitute the company.

Threat of new entries

This is the threat of new entrants.  Remember that this diagram is about the gain, profit and growth of the company. By analysing all of the key points, you will be able to recognize and dedicate certain actions to increase/decipher the growth of the company. This analyzes the threat of competitors gaining access to the marketplace, and how easily they could join and eliminate the share your business will have. The easier it is for companies to start up and join the marketplace, the greater risk it is for market shares to deplete. Looking at the barriers of entry such as costs, suppliers, customers, customer substitutes, etc.



To conclude this blog, the 5 forces is a very important aspect of business and money making. You will need to be using this as you make your business grow. Looking at competitors, substitutes, new entries, customers, etc is a very important thing to learn and know – especially for marketing. This is a good thing we learned this and had to research them.


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