Question

Consider a company either "in the literature" (possible options: Aerofarm, AMGEN, Visinex RFID) or your own aspiration in relation to Porter's Five Forces and submit the following: 1. A quick summary of the company and why you chose them for the exercise. 2. Complete an analysis on the position of your selected company in regard to the five competitive forces and actions that might be taken to improve the position: 1. competitive rivalry 2. threat of new entry 3. supplier power 4. threat of substitution 5. buyer power

Answer 1

Samsung is one of largest companies in mobile smartphone segment as well as smart devices with sizeable presence, strong brand name and steong fundamentals who faces host of challenges since 2002 dot com boom. Samsung has diversified into variety of electronic products to Telecommunications hardware provider and network integrator as core services.

Porter 5 forces analysis:

Bargaining power of Suppliers - Many suppliers in this segments offer low cost services which means bargaining power is less for suppliers.

Bargaining power of buyers- Since Samsung operates either in perfectly competitive market or Oligopolistic market across globe, buyers have higher choices and hence higher power.

Threat of New Entrants- Since new entries from lowcost Chinese providers can eat up Samsungs share due to ease of taxation and licensing, threat is higher substantially.

Threat of rivalry between existing firms- This is comparatively very high as margins are wafee thin and innovation is constantly evolving making it difficult for the industry as whole.

Barriers to entry- Large initial investment, high marketing and distribution spends, constant innovation are biggest barriers.