U.S. INSURANCE INDUSTRY - Five Forces Analysis

U.S. INSURANCE INDUSTRY - Five Forces Analysis

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Intensity of Existing Rivalry

Government limits competition (U.S. INSURANCE INDUSTRY) Government policies and regulations can dictate the level of competition within the industry. When...
Large industry size (U.S. INSURANCE INDUSTRY) Large industries allow multiple firms and produces to prosper without having to steal market share...
Fast industry growth rate (U.S. INSURANCE INDUSTRY) When industries are growing revenue quickly, they are less likely to compete, because the total...

Bargaining Power of Suppliers

High competition among suppliers (U.S. INSURANCE INDUSTRY) High levels of competition among suppliers acts to reduce prices to producers. This is a positive...
Diverse distribution channel (U.S. INSURANCE INDUSTRY) The more diverse distribution channels become the less bargaining power a single distributor will...
Critical production inputs are similar (U.S. INSURANCE INDUSTRY) When critical production inputs are similar, it is easier to mix and match inputs, which reduces...
Low cost of switching suppliers (U.S. INSURANCE INDUSTRY) The easier it is to switch suppliers, the less bargaining power they have. Low supplier switching...
Volume is critical to suppliers (U.S. INSURANCE INDUSTRY) When suppliers are reliant on high volumes, they have less bargaining power, because a producer can...

Threat of Substitutes

Substitute product is inferior (U.S. INSURANCE INDUSTRY) An inferior product means a customer is less likely to switch from U.S. INSURANCE INDUSTRY to...
Limited number of substitutes (U.S. INSURANCE INDUSTRY) A limited number of substitutes mean that customers cannot easily find other products or services...
Substantial product differentiation (U.S. INSURANCE INDUSTRY) When products and services are very different, customers are less likely to find comparable product...

Bargaining Power of Customers

Buyers require special customization (U.S. INSURANCE INDUSTRY) When customers require special customizations, they are less likely to switch to producers who have...
Product is important to customer (U.S. INSURANCE INDUSTRY) When customers cherish particular products they end up paying more for that one product. This...
Large number of customers (U.S. INSURANCE INDUSTRY) When there are large numbers of customers, no one customer tends to have bargaining leverage....

Threat of New Competitors

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

What is Porter's Five Forces Analysis?

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