Chapter 4 he eral emronment 10% EXHIBIT 4.9 Forces Driving Industry Competition Determinants of Entry Determinants of Rivalry \naumty gow Fd (or strage)costavlue added Inamitrs creapesty Brodit eons and er Swering cots Proprietary product Brand ently ‘Switching costs ania requirements ‘hosess to dstrbuton ‘Absolute cost advantages Proprietary curve ‘Ascoas to necessary inputs Proprietary low-cost product design ‘Government policy Expected retaliation [Bargaining Power, | | Suppliers |orsuppies | Concentration and balance Informational eorpienty Diversity of compettors Corporate stakos Ext bartors Threat ot New Entrants [ tnustey Competitors: Bargaining Power Determinants of Supplier Power Intensity of Rivaly Determinants of Buyer Power Differentiation of inputs Trreatot | Bargaining Leverage Price Sensitivity Stern costs of supper an fre __[Bibettae | ewer concotaton, Preeti puchason each ee ee sce ee Suppor concentration a Buyer sfeing costs Impact on quality Importance of volume to supplier ee aes Cost relative to total purchases in Determinants of raat Dian eae ihe nen Substitution Threat | Buyer information Decision makers! Impact of nputs on cost or dfrentation pra pty ease ‘Threat of forward integration relative to Relative price rns threat of backward integration By Ame perormance IE of substitutes In the industry Pullthrough ‘Switching costs Buyer propensity 10 substitute ‘Source: Reprinted by permission of Harvard Business Review, Exhibit fom “How Competitive Forces Shape Strategy” by M.E, Pore Siar Apa 1979. Copyright 1979 by the Harvard Business School Publishing Corporation al rights reserved