Porter’s 5 Forces Model (Porter, 1980): Mechanical Sugarcane Harvester Industry

Threat of New Entrants

Government Policy: As discussed in PESTLE Government is encouraging companies to invest and develop new products for sugarcane. This
has encouraged many small time manufacturers to join hands with foreign companies to bring new products in the Indian Market
Customer Loyalty: Currently the price of the products being too high sugar mills and different government institutions are the main buyers.
These type of customers trust the brand more than the price of the product

Rivalry among Industry

Bargaining Competitors Bargaining
Power of Till date about 160-170 machines (Maharashtra 120 +
Karnataka 30 + TN 10-15) are operational, majorly from
Power of
Suppliers companies like:- Buyers
The available data is really Bunmei, Thailand make, chopper cane harvester Degree of Dependency: The
limited. But many mechanical harvester is
factories import the main LCT Hansen, Chinese make, whole cane harvester still new therefore Buyer
components is not that dependent.
John Deere -3520W, 7000 series, US make, chopper cane harvester Buyer Price Sensitivity:
Financially Indian farmer
Case New Holland- 4000 series, chopper cane harvester is week. Therefore farmers
prefer goods with low cost
John Deere and New Holland lead the market. John Deere has
introduced new models recently.

(Source: Indian Sugar Mills Association 2012)

Threat of Substitute Products or Services

Ease of Substitution: The immediate Substitute to mechanical harvester is labour force.
Level & Number of Product differentiation: Apart from labour there are manually propelled, mini sugarcane harvesters. The range starts
from Rs. 20,000 (alibaba.com, 2014)