Porter's 5 Forces Model

On Reliance Industril
Ltd
By ,

Rahul Bhaurao Wagh MBA I

Roll No. 127

 Introduction
 This model is given by ''Michel porter'' in year 1979.
 By using this model we are understand a actual working of Reliance
industry.
 Reliance industries is the private limited corporation listed in he Fortune 500
and known to be the biggest private sector organization in India.
 The corporation has evolved itself rom being only polyester and textile
company to integrated player of energy, retail, digital services,
entertainment. materials, and telecommunication.
 For determining the competition level in the industry, it is essential for the
company to use Porter five forces model, which helps in identifying the
strategic position of the industry and helps in making effective decisions.
 Here is the porter five forces analysis of Reliance industries.
 How This Model Helps In Business

 Porter's Five Forces is a model that identifies and

analyses five competitive forces that shape every industry
and helps determine an industry's weaknesses and strengths.

 Five Forces analysis is frequently used to identify an industry's

structure to determine corporate strategy.
Reliance Porter's 5
Forces Model
 1. Reliance threats of new entrance
 2. Reliance bargaining power of supplier
 3. Reliance bargaining power of buyers
 4. Reliance threats of substitute
 5. Reliance rivalry among the players
The five forces model by michel porter
 1. Reliance threat of new entrants

 Threats from the substitute products for the Reliance industries is moderate
however on the individual basis it will be different because there are many
substitutes available for the textile, telecommunication, etc.

 It is necessary for the reliance industries to increase the switching cost of the
products so that customers will not switch to the alternatives.

 Moreover, consumers must not derive the same utility in terms of quality and
prices from the substitute products as per reliance industries products.

 The corporation should reduce the threats from substitutes by offering more
differentiated products and increase the switching costs (Henry. 2018).
 2. Reliance bargaining power of
suppliers

 Bargaining Power of Suppliers The suppliers of the Reliance industry are many as
compared t buyers.

 For example, in the telecommunication industries, there are Samsung, LG, etc. who are
providing the services also, which lowers the price control of Reliance in
telecommunication industry.

 However, in case of not achieving the cost advantage. Reliance industries supply chain
is very efficient and can switch the suppliers.

 Reliance industries has to work on the supplier contractual relationship, to achieve

benefits and economies of scales (Murphy. 2018).
 3. Reliance bargaining power of
buyers

 When buyers have high bargaining power then they demand for lower the price and
higher the product quality.

 The bargaining power of buyers in case of reliance industries is moderate on

aggregate level, but its different in individual basis.

 For example, bargaining power of buyer is high in telecommunication industry of

reliance. because of multiple options available, and so in the textile industry.

 However, on the aggregate level it is gaining cost advantage and have control on
prices, because of the largest corporation of India, and this means more customers
than rivals.

 It is necessary for the corporation to decrease the bargaining power of buyers on

segment basis and increase the customer base (Manoj. 2012).
 4. Reliance threats of
substitute

 Threats from the substitute products for the Reliance industries is moderate however
on the individual basis it will be different because there are many substitutes
available for the textile, telecommunication, etc.

 It is necessary for the reliance industries to increase the switching cost of the products
so that customers will not switch to the alternatives. Moreover, consumers must not
derive the same utility in terms of quality and prices from the substitute products as
per reliance industries products.

 The corporation should reduce the threats from substitutes by offering more
differentiated products and increase the switching costs (Henry. 2018).
 5.Reliance rivalry among the players
 Rivals do exist in the industry of textile, materials, telecommunication etc.
and hence Reliance industries compete with them at individual basis.

 It is important for the corporation on implicit needs and the customers'

expectations for strengthening the differentiation.

 It is necessary for the corporation to increase the switching cost to

develop good customer relationship.

 The corporation must spend more in R&D to open new doors for the
company and look more for mergers and acquisition to reduce the
competition in the industry (Henry. 2018).
 Conclusion
 This model is simple and a powerful tool for understanding the
business situations of the Reliance industry.

 It help to understand the strength of your current competitive

positions and the strength of a position you are looking to
achieve.
 Sources
 Google.com
 Youtube.com
 Powerslides.com
THANK YOU !