Porter’s Five forces analysis is a framework for industry analysis
and business strategy development formed by Micahel E.Porterof Harward Business school in 1979.It draws upon industrialorganization economics to derive five forces that determine thecompetitive intensity and therefore attarctiveness of market.attractivesness in this context refers to over all industry
profitability. An “unattractive” industry is one in which the
combination of these five forces acts to drive down overallprofitability.
Three of porter’s five forces refer to competitive from external
sources. The remaining are internal threats. Porter referred tothese forces as the micro environment, to contrast it with themore general term macro environment.