Pharma - Five Forces Analysis

Pharma - Five Forces Analysis

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Intensity of Existing Rivalry

Low storage costs (Pharma) When storage costs are low, competitors have a lower risk of having to unload their inventory all at...
Exit barriers are low (Pharma) When exit barriers are low, weak firms are more likely to leave the market, which will increase the...

Bargaining Power of Suppliers

Large number of substitute inputs (Pharma) When there are a large number of substitute inputs, suppliers have less bargaining leverage over...
High competition among suppliers (Pharma) High levels of competition among suppliers acts to reduce prices to producers. This is a positive...
Inputs have little impact on costs (Pharma) When inputs are not a big component of costs, suppliers of those inputs have less bargaining power....
Critical production inputs are similar (Pharma) When critical production inputs are similar, it is easier to mix and match inputs, which reduces...
Low cost of switching suppliers (Pharma) The easier it is to switch suppliers, the less bargaining power they have. Low supplier switching...
Volume is critical to suppliers (Pharma) When suppliers are reliant on high volumes, they have less bargaining power, because a producer can...

Threat of Substitutes

Substitute product is inferior (Pharma) An inferior product means a customer is less likely to switch from Pharma to another product or...
High cost of switching to substitutes (Pharma) Limited number of substitutes means that customers cannot easily switch to other products or...

Bargaining Power of Customers

Buyers require special customization (Pharma) When customers require special customizations, they are less likely to switch to producers who have...
Product is important to customer (Pharma) When customers cherish particular products they end up paying more for that one product. This...

Threat of New Competitors

Strong distribution network required (Pharma) Weak distribution networks mean goods are more expensive to move around and some goods don’t get to...
High sunk costs limit competition (Pharma) High sunk costs make it difficult for a competitor to enter a new market, because they have to...
Patents limit new competition (Pharma) Patents that cover vital technologies make it difficult for new competitors, because the best...
High learning curve (Pharma) When the learning curve is high, new competitors must spend time and money studying the market...
Customers are loyal to existing brands (Pharma) It takes time and money to build a brand. When companies need to spend resources building a brand,...
Entry barriers are high (Pharma) 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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