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Here you need to concentrate on how many buyers there are in the market, the size of their orders, how easy it would be for them to switch from you to your competitors. Buyer power: The buyers have the power to drive prices low and demand higher quality products.How expensive would it be to switch suppliers or can you find substitute material? Supplier power: Look at how many potential suppliers are there in the market, how scarce is the raw material, their service and how easy it is for them to increase their prices.Here you may need to devise strategies to respond to and overcome the competition. The competitive rivalry could be high when there are multiple competitors in the industry and the industry growth rate is slow. Competitive rivalry: This is where you need to consider the number of competitors in the industry and the effect they have on you.It is better to use a worksheet template to record the information you gather. When using Porter’s five forces model to analyze your competitive landscape, you will be looking at each of the forces in turn.The 5 forces are threat of new entrants, threat of substitutes, bargaining power of suppliers, bargaining power of buyers, and intensity of competitive rivalry.
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The model focuses on a set of five factors that help understand the competitive strength and the market position of an organization. Porter’s five forces model is a strategic framework that helps organizations understand the intensity of competition in an industry, its attractiveness and profitability level.