Which of Porter's 5 forces experiences the strongest change when launching a new brand?

Principles of Management
OER 2019th Edition
ISBN:9780998625768
Author:OpenStax
Publisher:OpenStax
Chapter18: Management Of Technology And Innovation
Section18.3: External Sources Of Technology And Innovation
Problem 1CC: Look at the Acer case at the beginning of the chapter and respond to the following items. 1....
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Which of Porter's 5 forces experiences the strongest change when launching a new brand?

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Step 1

There are five porter’s forces which affected by the launch of a new brand in the market..

1)Threat of new entrants: power is also affected by the ability of people to enter in market attracted by little cost in terms of time or money effectively, if there are few economies of scale in place or if they're less protection of significant technologies then-innovative competitors can easily enter in the market and can weaken the position of any business.

 For example, the launch of clothes of children Threat of new entrants is always there in an industry as competitive as children’s clothes. Children’s clothes are a great industry because every child grows fast and they need to buy new clothes almost every 1-2 years

Step 2

2) Bargaining power of suppliers: it sells about how convenient can supplier influence or raise the price level. This depends on several suppliers of each key input, the uniqueness of their product or saving their strength and control in the market and so on.

The fewer the supplier choices, the more powerful the supplier is.

For example, there might be very few suppliers that supply natural fibers only, so there certainly can be a chance of higher prices charged by suppliers which could be a threat to the company

Step 3

3) Threat of substitutes: if it is easy to substitute the product and if substitution is viable then it weakens the power of business. For example, there is always a threat of substitutes because there are various materials of clothes that are available, and people may not be interested in natural fiber only products.

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