Assignment # 01

Managerial Policy

Course Instructor
Dr. Atif Aziz

Presented By
Muhammad Zohaib
10456
The following are the Michel Porters 5 Forces:

 Threats of New Entrants.

 Bargaining Power of Supplier.
 Bargaining Power of Buyer.
 Threat of Substitute.
 Intense Rivalry.

The above points are applied on the Case Study of Amazon:

Threats of New Entrants:

The entry barrier for the new entrants is higher as Amazon has flourished over the period of time
and has a enhances its customer base over loyalty and thus helping the company’s growth in terms
of revenue.

Bargaining Power of Supplier:

The bargaining power of supplier is lower in the case of Amazon as it has a strong financial standing
and a large number of suppliers on board due to this the company reduces its cost and has become
the cost leader in the market. The stakeholders such as suppliers are taken care by fulfilling their
expectations and preferences to achieve the above

Bargaining Power of Buyer:

Lower customer bargaining power due to the following factors:

The product ranges

Technological advancements

Convenience purchase

Customer review.

These factors provide the strong evidence in lower bargaining power of buyers/customers as and
when the buyer receive all the facilities under one roof, they become loyal to the brand and product.

Threat of Substitute:

Amazon does not carry a threat of substitution as the products offered by Amazon are same as of its
competitors but it is only 10% of Amazon and in terms of service that is provided by Amazon other
competitors cannot substitute it on the bases of service.

Intense Rivalry:

There are many rivals in the market for Amazon such as E-bay, Barnes & Noble and Wal-Mart but it
has been distinctive from them having faced the competition having the lowest price strategy but
the fact is amazon wins on the ground of highest customer base.