The ease with which new companies can enter a market, including barriers to entry.
Threat of New Entrants
Measures the ability of new companies to enter an industry and compete with existing firms. High threat if barriers to entry are low, market is growing, and there is a lot of demand.
Bargaining Power of Suppliers
Describes the power of suppliers in an industry. High power if suppliers are concentrated, substitute products are available, and the supplier has high switching costs.
Bargaining Power of Buyers
Measures the power of customers in an industry. High power if there are many buyers, they are concentrated, and they have high switching costs.
Threat of Substitute Products or Services
Assesses the risk of customers switching to alternative products or services. High threat if there are many substitutes, they are improving in quality, and they are cheaper.
Competitive Rivalry Among Existing Competitors
Describes the intensity of competition among existing firms in an industry. High rivalry if there are many competitors, they are similar, and they are all fighting for market share.
