Porters 5-Force Analysis Essay Example | Topics and Well Written Essays - 1500 words

Porters 5-Force Analysis - Essay ExampleIn the fol baseborning paper the example of online university as a part of a strategic group in spite of appearance the larger context of universities will be considered to research the Porters Five Forces model. The theory of five forces model along with practical analysis is combined in distributively of Porters discussion within the chosen constancy.In the analysis of online university it is of the essence(predicate) to carefully enumerate the supplier group. Suppliers to the online education industry would be faculty (content suppliers), mentors, software providers and possibly in the case of state-supported institutions, the legislators and regents. Given that legislators and regents have considerable power in some instances, one has to acknowledge that the principal supplier group exerts relatively little power in relationship to the industry. Thus the bargaining power of suppliers is low.Barriers to admission deter new competitors from entering the market and creating more competition for establish firms. There are several major barriers to entry and they include economies of scale, capital requirements, product differentiation, switching costs, cost disadvantages independent of scale, access to distribution channels, and government policy. whiz example of an industry with high barriers to entry is computer chip manufacturing. The extremely high cost of building a fabrication plant makes entry into this industry very risky. The resturaunt industry on the other hand has considerably fewer barriers to entry since almost everything can be leased and employees need not be highly experienced and trained. (Porter, 7).One has only to watch the Internet to see almost daily announcements of new email courses, programs and degrees rapidly proliferating. The reasons for this are fairly obvious. Barriers to entry are low. Capital requirements are minimal. Switching costs are not important to the buyers and brand ident ity is probably not nearly as important as access and convenience. Demand for this product is growing rapidly as industry demands larger numbers of advanced degrees and education to meet market demands. The curse of new entrants is high.III. THREAT OF SUBSTITUTESThreat of Substitutes exist when the demand for a product declines due to either lower prices of a better performing substitute product, low brand loyalty, new current trends, or low switching cost. When threat of substitutes is low the outcome is favorable to the industry,