When to apply Porter's 5 forces analysis?
It is worth applying Porter's 5 forces when considering entering a given indonesia whatsapp mobile number market. This method is used to assess the attractiveness of a sector and is based on 5 different factors, related to the environment in which the company operates, namely:
bargaining power of suppliers,
bargaining power of buyers,
the intensity of the competitive struggle within the sector,
the threat of new producers,
the threat of substitutes.
Porter's 5 forces - an example
To better illustrate Porter's 5 forces method, the example of an electronics company that manufactures personal computers will be used.
Where to start with Porter's 5 Forces analysis? - Assessing the attractiveness of the sector
Correct analysis Start by defining the sector in which the company will operate. Remember that sector is a narrower concept than industry, so its definition is up to you. If we use the example of a company in the electronics sector, a sector can be "the computer market" or "the market for computers and mobile devices". In the rest of the article, the second option will be used.
Sector size
Once the industry has been defined, its size must be determined. It is most often defined as the sum of the annual turnover of all companies in the industry in a given market. Determining exact figures is very difficult in practice - after all, we are not going to call all potential competitors to ask them about their revenue for the current year, especially if we are doing the analysis using the DIY method. There is a lot of information on this topic on the Internet, or you can think about it yourself. After all, it is obvious that since the major laptop manufacturers are global companies, they have "large" revenues, so we will simply call the industry size "large".