What is Porter's Five Forces Template?
Porter's Five Forces is a strategic framework which is used to analyze the internal competition of an industry. It analyses and identifies five key forces that shape competition.
What are the five elements in Porter's 5 Forces?
1. Industry Rivalry:
The first of Porter's Five Forces looks at the intensity of competition among current competitors in the industry.
2. Supplier Power:
The influence that suppliers have over the pricing and availability of inputs.
3. Buyer Power:
The ability of customers to demand lower prices or higher quality.
4. Threat of Substitute:
The likelihood that alternative products or services can replace the current offering.
5. Threat of New Entrants:
The potential for new competitors to enter the industry and challenge existing players.
Porter's 5 Forces vs. SWOT Analysis: What's the Difference?
Porter's Five Forces and SWOT Analysis are both strategic tools used to assess a business environment, but one major difference is Porter’s Five Forces focuses on external competitive forces, while SWOT Analysis includes both internal and external factors to guide strategy.