3.

Because of the nature of fragmented sectors, they frequently have lower entry barriers than more
consolidated industries. This is the reason fragmented industries are highly appalling. The
following are the primary causes of industrial fragmentation: • Entry barriers are low in nearly all
fragmented industries, but fragmentation is usually caused by one or more other factors. • The
lack of economies of scale or the advantages of a learning curve • Local demand may cause the
industry to become fragmented Ways to consolidate presence in the industry: • Chaining -
Creating a network of linked retail shops to gain the benefits of cost leadership. For example –
Meena Bazar, Daily Shopping etc. • Horizontal merger: Acquiring competitors such as CEMEX
Cement Bangladesh was acquired by Siam City Cement of Thailand, the local Philips and Pepsi
businesses were acquired by Transcom, significant shares of Citycell were acquired by SingTel,
and AKTEL shares by NTT DoCoMo. • Franchising – Parent company allows representatives to
use names, logos and brand for a fee. Example: Sbarro Inc. (Closed), Krispy Kreme Doughnuts
etc.

2.

Value Innovation is a particularly useful mentality and technique for figuring out what a rival is
after and what their customers value, which may help entrepreneurs figure out how to compete
and where to invest. It is a procedure in which a corporation introduces new technology or
improvements to an existing product or model that the company has never done before. It allows
companies to ensure greater value through superior differentiation at a lower cost than was
possible and outperform its rivals. Examples of value innovation includes: Bloomberg, iTunes,
Nintendo Wii, Canon etc. Bloomberg understood that its traders and analysts who should be
making financial decisions for the employers not IT managers. Disparities in information offer
profit opportunities. Traders and analysts must make quick decisions while markets are active.
Bloomberg created a system with easy-to-use terminals and keyboards branded with common
financial words to give traders a boost in value. The devices also include two flat-panel monitors
so traders can see all of the data they need at once, as well as built-in analytic capacity that can
be accessed with a single button click. Bloomberg decided to provide information and purchase
services to help traders with their personal life. Traders could utilize Bloomberg online services to
buy flowers, apparel, and jewelry, make trip plans, learn about wines, and look through real
estate listings long before the internet offered similar services; thus, creating a unique value
curve throughout the industry.

ANSWER 1 THEORY PART, PLS COPY PASTE IT *

5/5

Porter’s five forces for the Covid-19 vaccine industry: • Threat of New Entrants: Threat of new
entrants is significantly lower in this industry because of the extensive cost of setting up the
manufacturing operations such as research and development, distribution, sales etc. Through
their years of expertise, most of the existing companies attained economies of scale. The risk
associated with developing a drug and its trial phase along with strict regulations from
Government is another crucial reason for the entry barrier to be so high. • Competitive Rivalry:
Competitive rivalry is high in this industry, especially during the covid-19. All the existing
companies are in a constant pressure to develop and improve vaccines specifically for the Covid-
19 which will ensure to capture a massive chunk of the market. • Bargaining power of suppliers:
Bargaining power of suppliers is relatively low as the companies only needs the raw materials,
technology and the final packaging materials. A number of suppliers are available to provide such
things and are in no position to bargain or influence the prices. • Bargaining power of buyers: This
is also very low due to the current condition as only a handful of companies are able to produce
vaccines and almost all of which are being regulated by the Governments currently. The buyers
have no choice but to register for the available vaccines regardless of the providers. • Threat of
Substitutes: For the covid-19 vaccines, substitutes are very limited as only a number of
companies are able to produce and deliver vaccines as of now. As a result, threat of substitution
is low. However, this may rise as more companies are going through trial phase to start producing
vaccines. The major players of the industry are: Moderna, Oxford-Astrazeneca, Pfizer, Sputnik V,
Sinovac and Jhonson & Jhonson In my opinion the market leader is Moderna with an efficiency
rate of 95%. Extensive distribution along with similar price tags has been a huge plus for them to
dominate the market. The most contributing factor is that it can be stored for up to 7 months in
-20C and has a 100% effectiveness against death from covid-19 (Source: CDC and FDA as of
March 25, 2021)