Assignment 1 Module Code:PICS01C Student Number:7305-272-8 due(p) Date:15 March 2011 [pic] a) Five-forces diagram for analysis of the sell car industry in the greater Johannesburg area 1. private-enterprise(a) Rivalry war-ridden rivalry exists between companies with the same or similar products/service and similar markets. Factors to be considered include: The number and size of competitors The set out of industry growth Differentiation and switching costs Fixed costs or perishable products Expansion High exit barriers Diverse strategies Companies have to skirmish for a competitive advantage over its rivals. Industry assiduity is measured through ingress ratios. A higher concentration ratio indicates that a company holds the largest share of the market resulting in a less competitive and more disciplined landscape. Competitive advantage can be obtained by a compounding of the following strategies: Changing prices Improving product differentiation Creatively victimisation channels of distribution Exploiting proportionships with suppliers Companies should formulate a corporate strategy that addresses these areas deep down the five forces competitive analysis. 2.
The Threat of accession The threat of new competitors ledger entry the market can be managed by restricting the entry barriers through: Economies of scale Capital cost of entry Control of distribution channels trustworthy relationships Time Retaliation Legal restraints Differentiation A healthy economy should provide freedom for any type of company and competition to enter the market. This should except be closely managed by existing companies in launch to stay ahead of its game. The risk of new entrants can negatively affect a market resulting in companies closing down. increase and decreasing profits have a direct relation to new entrants in the market. When profits are high... If you want to disembowel a full essay, order it on our website:
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