Porter five forces model is basically a framework for industry analysis. It helps in business strategy development.

It was presented by Micheal Porter. According to this framework, there are 5 forces that determine the competitiveness of a market and its attractiveness and profitability. These forces are ! Threat of substitute products ! "argaining power of buyers ! "argaining power of sellers ! Threat of new entrants ! #ompetitive rivalry within an industry.

Threat of substitute products

Any industry can be taken as an e$ample of this model. Take for e$ample, the Pakistani Te$tile industry. The threat of substitutes is high, the bargaining power of buyers is high, the bargaining power of seller is low because there are many of them, the threat of new entrants is high because it is easy to set up a te$tile mill. %o the competitive rivalry in the industry is high because the set up cost is low and there are a number of substitutes available to the customers.