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I’m working on a business discussion question and need an explanation and answer to help me learn.

RESPONSE 1.) Jayne

The five competitive forces model (Boone and Kurtz) was identified by Michael E. Porter.

The Threat of new competitors

– (Boone and Kurtz, 2021) explained that existing businesses always fear the entrance of new competitors entering the market. However, depending on the product, the Threat is not likely. For example, a car manufacturer would have fewer competitors than a candy bar manufacturer.

The Threat of supplier power –

(Boone and Kurtz, 2021) the threat of supplier power involves diluting the producers of raw materials and causing a shortage for other corporations in need of the same material

The Threat of Buyer power –

(Boone and Kurtz 2021) the threat of buying power is similar but different from the threat of supplier power.  The threat of buying power refers to when big-box retailers like Walmart, Costco, and Sam’S Club buy up the producer’s stock creating a deficiency for other retailers.

The Threat of Substitutes –

(Boone and Kurtz 2021) The threat of substitutes occurred when a company like AT&T developed the cellphone and others like Mint Mobile could offer the same deal at a comparable price.

The Threat of Competitive Rivalry –

The threat of competitive rivalry happens when many producers make the same product and create a decrease in the price of the item.


Boone, L. E., & Kurtz, D. L. (2021). Contemporary marketing. Cengage Publishing. ISBN: 9780357461709


Porter’s Five Forces is a model that identifies and analyzes five competitive forces that shape every industry and helps determine an industry’s weaknesses and strengths (Boone & Kurtz, 2021). Five Forces analysis is frequently used to identify an industry’s structure to determine corporate strategy. Porter’s model can be applied to any segment of the economy to understand the level of competition within the industry and enhance a company’s long-term profitability. The first of the five forces refers to the number of competitors and their ability to undercut a company. The more significant the number of competitors, along with the number of equivalent products and services they offer, the lesser the company’s power. The last of the five forces focus on substitutes. Substitute goods or services that can be used in place of a company’s products or services pose a threat.

Boone, L. E., & Kurtz, D. L. (2021). Contemporary marketing. Cengage Publishing. ISBN: 9780357461709

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