Airflex 1 - Five Forces Analysis

Airflex 1 - Five Forces Analysis

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Intensity of Existing Rivalry

Low storage costs (Airflex 1) When storage costs are low, competitors have a lower risk of having to unload their inventory all at...
Fast industry growth rate (Airflex 1) When industries are growing revenue quickly, they are less likely to compete, because the total...
Government limits competition (Airflex 1) Government policies and regulations can dictate the level of competition within the industry. When...
Relatively few competitors (Airflex 1) Few competitors mean fewer firms are competing for the same customers and resources, which is a...
Exit barriers are low (Airflex 1) When exit barriers are low, weak firms are more likely to leave the market, which will increase the...
Large industry size (Airflex 1) Large industries allow multiple firms and produces to prosper without having to steal market share...

Bargaining Power of Suppliers

Large number of substitute inputs (Airflex 1) When there are a large number of substitute inputs, suppliers have less bargaining leverage over...
High competition among suppliers (Airflex 1) High levels of competition among suppliers acts to reduce prices to producers. This is a positive...
Low concentration of suppliers (Airflex 1) A low concentration of suppliers means there are many suppliers with limited bargaining power. Low...
Diverse distribution channel (Airflex 1) The more diverse distribution channels become the less bargaining power a single distributor will...
Inputs have little impact on costs (Airflex 1) When inputs are not a big component of costs, suppliers of those inputs have less bargaining power....
Critical production inputs are similar (Airflex 1) When critical production inputs are similar, it is easier to mix and match inputs, which reduces...
Volume is critical to suppliers (Airflex 1) When suppliers are reliant on high volumes, they have less bargaining power, because a producer can...
Low cost of switching suppliers (Airflex 1) The easier it is to switch suppliers, the less bargaining power they have. Low supplier switching...

Threat of Substitutes

Substitute has lower performance (Airflex 1) A lower performance product means a customer is less likely to switch from Airflex 1 to another...
Substitute is lower quality (Airflex 1) A lower quality product means a customer is less likely to switch from Airflex 1 to another product...
Substitute product is inferior (Airflex 1) An inferior product means a customer is less likely to switch from Airflex 1 to another product or...
Substantial product differentiation (Airflex 1) When products and services are very different, customers are less likely to find comparable product...
Limited number of substitutes (Airflex 1) A limited number of substitutes mean that customers cannot easily find other products or services...
High cost of switching to substitutes (Airflex 1) Limited number of substitutes means that customers cannot easily switch to other products or...

Bargaining Power of Customers

Buyers require special customization (Airflex 1) When customers require special customizations, they are less likely to switch to producers who have...
Low buyer price sensitivity (Airflex 1) When buyers are less sensitive to prices, prices can increase and buyers will still buy the product....
Limited buyer information availability (Airflex 1) When buyers have limited information, they are at a disadvantage in negotiations with sellers....
Low dependency on distributors (Airflex 1) When produces have low dependence, distributors have less bargaining power. Low dependency...
Product is important to customer (Airflex 1) When customers cherish particular products they end up paying more for that one product. This...
Large number of customers (Airflex 1) When there are large numbers of customers, no one customer tends to have bargaining leverage....
Limited buyer choice (Airflex 1) When customers have limited choices they end up paying more for the choices that are available....

Threat of New Competitors

Strong distribution network required (Airflex 1) Weak distribution networks mean goods are more expensive to move around and some goods don’t get to...
High capital requirements (Airflex 1) High capital requirements mean a company must spend a lot of money in order to compete in the...
High sunk costs limit competition (Airflex 1) High sunk costs make it difficult for a competitor to enter a new market, because they have to...
Strong brand names are important (Airflex 1) If strong brands are critical to compete, then new competitors will have to improve their brand...
Advanced technologies are required (Airflex 1) Advanced technologies make it difficult for new competitors to enter the market because they have to...
Industry requires economies of scale (Airflex 1) Economies of scale help producers to lower their cost by producing the next unit of output at lower...
Patents limit new competition (Airflex 1) Patents that cover vital technologies make it difficult for new competitors, because the best...
Geographic factors limit competition (Airflex 1) If existing competitors have the best geographical locations, new competitors will have a...
Customers are loyal to existing brands (Airflex 1) It takes time and money to build a brand. When companies need to spend resources building a brand,...
High switching costs for customers (Airflex 1) High switching costs make it difficult for customers to change which products they normally...
High learning curve (Airflex 1) When the learning curve is high, new competitors must spend time and money studying the market...
Entry barriers are high (Airflex 1) When barriers are high, it is more difficult for new competitors to enter the market. High entry...

What is Porter's Five Forces Analysis?

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