Porter's five forces

Threat of Bargaining power

new entrants of suppliers

Porter's five
forces

Threat of Bargaining power

substitutes of customers

Competitive
rivalry
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 Porter's five forces with explanation

Threat of Threat of Bargaining Bargaining Competitive

new entrants substitutes power of power of rivalry
customers suppliers

 No barriers for new  Lot of alternatives  Multiple options to  Ecommerce is one  High exit cost for
entrants available choose from among the multiple inventory based
 Initial capital  No product  Low switching cost channels for selling model.
the products to the
investment is less differentiation  Unique competitive
 Price information customers. advantage.
 Huge growth  No switching cost for easily available
 Higher chances of
opportunities, since the buyer
forward integration
industry is at nascent
stage  Low switching cost
for the companies

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 Potential factors of forces
Threat of new entrants
 The existence of barriers to
entry
 Cost disadvantages
independent of size
 Economies of scale
 Product differentiation
 Brand equity
Bargaining power of
suppliers
 Supplier switching costs
relative to firm switching
costs
 Degree of differentiation of
inputs
 Impact of inputs on cost and
differentiation
Threat of substitutes
 Buyer propensity to
substitute
 Buyer's switching costs
 Number of substitute
products available in the
market
 Ease of substitution
Competitive rivalry
 Sustainable competitive
advantage through
innovation
 Competition between online
and offline companies
 Level of advertising expense
 Firm concentration ratio Bargaining power of
customers
 Buyer switching costs
 Buyer information availability
 Availability of existing
substitute products
 Buyer price sensitivity
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