Industry and Competitor Analysis Form

III. TheFiveCompetitiveForcesThat

DetermineIndustryProfitability

Factorsthathaveanimpactontheabilityofsupplierstoexertpressureonbuyers

E.BargainingPowerofBuyers

Supplier

concentration

Switchin

costsarethefixedcoststhatbu

ers

Whentherear eonlyafewsuppliersthat

supplyacriticalproducttoalargenumberof

buyers,thesupplierhasanadvantage.

Universityof Zurich

ISU– InstituteforStrategyandBusinessEconomics

UlrichKaiser

AprimerinEntrepreneurship

Springsemester2008

Switchingcosts

g y

encounterwhenswitchingorchangingfrom

onesuppliertoanother.Ifswitchingcostsare

high,abuyerwillbelesslikelytoswitch

suppliers.

III. TheFiveCompetitiveForcesThat

DetermineIndustryProfitability

Factorsthathaveanimpactontheabilityofsupplierstoexertpressureonbuyers

E.BargainingPowerofBuyers

Attractiveness

ofsubstitutes

Th f li i hdif th i

Supplierpowerisenhancediftherearenoattractive

substitutesfortheproductorservicesthesupplieroffers.

Forexample,thereislittlethecomputerindustrycando

whenIntelorMicrosoftraisetheirprices,asthereare

simplynopracticalsubstitutesfortheirproducts.

Universityof Zurich

ISU– InstituteforStrategyandBusinessEconomics

UlrichKaiser

AprimerinEntrepreneurship

Springsemester2008

Threatof

forward

integration

epowero

asupp

er

sen

ance



ere

sa

crediblepossibilitythatthesuppliermightenter

thebuyer’sindustry.

Page 11/17

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