Factors that tend to result in weak rivalry among competing sellers include: B) rapid growth in buyer demand, high buyer costs to switch brands , and more strongly differentiated products.
What increases rivalry among competing sellers?
- Numerous or equally balanced competitors.
- Slow industry growth.
- High fixed or storage costs.
- Lack of differentiation or switching costs.
- Capacity increased in large increments.
Which of the following are factors that affect the strength of rivalry among competing sellers?
- Numerous or equally balanced competitors. ...
- Slow industry growth. ...
- High fixed or storage costs. ...
- Lack of differentiation or switching costs. ...
- Capacity increased in large increments. ...
- Diverse competitors. ...
- High strategic stakes. ...
- High exit barriers.
Which of the following conditions causes high rivalry among competing firms?
The intensity of rivalry will be high if industry growth is slow . If the industry’s fixed costs are high, then competitive rivalry will be intense. Additionally, rivalry will be intense if the industry’s products are undifferentiated or are commodities.
What are the that influence the intensity of rivalry?
Many factors influence the intensity of rivalry among firms in an industry. In general the number and size of the rival firms, demand growth of industry product or service, amount of fixed costs and exit barriers are the forces behind the intensity of rivalry in an industry.
What is rivalry among competing sellers?
Competitive rivalry is a measure of the extent of competition among existing firms . Intense rivalry can limit profits and lead to competitive moves, including price cutting, increased advertising expenditures, or spending on service/product improvements and innovation.
When would rivalry among competing sellers be less intense?
3. Rate of Market Growth. The rate at which the overall industry is growing is another aspect that influences competitive intensity. For instance, if the market is growing rapidly , the rivalry between firms will be less intense.
What is competitive rivalry example?
For example, if there are large exit barriers in an industry, competitors will be unlikely to leave. Relatedly, large fixed costs relative to variable costs can increase competitive rivalry. Think of two examples: railroads and public utilities . ... Similarly, brand identity can lead to very intense competitive rivalry.
What is Porter’s 5 Forces Analysis example?
According to this framework, competitiveness does not only come from competitors. Rather, the state of competition in an industry depends on five basic forces: threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitute products or services, and existing industry rivalry .
What are the forces competing within the industry?
Customers, suppliers, substitutes and potential entrants —collectively referred to as an extended rivalry—are competitors to companies within an industry. The five competitive forces jointly determine the strength of industry competition and profitability.
Which of Porter’s five forces is the strongest?
Competition from within the financial industry is probably the strongest of Porter’s Five Forces when analyzing JPMorgan Chase.
How do you use Porter’s five forces?
- Threats of new entry. Consider how easily others could enter your market and threaten your company’s position. ...
- Threat of substitution. ...
- Bargaining power of suppliers. ...
- Bargaining power of buyers. ...
- Competitive rivalries.
How do you overcome competitive rivalry?
- Identify a need in the industry and satisfy it with a product or service. ...
- Improve on existing products or services. ...
- Highlight your differences. ...
- Clarify your brand and message. ...
- Focus on the needs of your customers. ...
- Focus on the needs of your employees. ...
- Do not focus on your competitors.
What is a good indicator of competitive rivalry?
Competitive rivalry is a measure of the extent of competition among existing firms. Intense rivalry can limit profits and lead to competitive moves including price cutting , increased advertising expenditures, or spending on service/product improvements and innovation.
What are the competitive factors?
- Competitive factors cover how businesses who offer similar products or services affect each other. ...
- When a successful product is introduced, rival organisations will often respond by trying to undercut it by quickly producing cheaper alternative versions.
What are the factors that influence strategic response?
Factors influencing changes in strategic management may be internal or external to the business organization. Some of these factors include management functions, structural transformations, competition, socio-economic factors, laws and technology .
