Porter
identifies five competitive forces that determine the intensity of competition
in an industry and the total value of profits created in a particular industry.
The five forces are
1) new entrants,
2) substitute products or services,
3)
bargaining power of suppliers,
4) bargaining power of buyers, and
5 ) rivalry
among existing firms.
A key to selecting appropriate generic strategies is to
analyze these competitive forces in terms of trends, opportunities,
and threats
facing the firm.
