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new potential
enter the sector
new threat
arrive sector
power
negotiation power
providers The competitors in the negotiation of customers
providers sector Customers
- rivalry
incumbents
threat
products
nounituţie
Made by
substitution
1
- producers existence of overcapacity, which stimulates them growing producţii- and increase
market share;
- registration of important strategic stakes such as the repositioning over a lucrative conquest of
potential market segments, mergers and acquisitions with expected favorable effects
These conditions cause frequent outbreak of "wars" of prices and advertising need to
implement strategies for diversification and renewal of products offered and increasing cost
competition.
2. Entry of new competitors in the area of activity in terms of the degree of threat posed
by them.
one area It is not attractive if in the future he can easily enter the new competitors that will
bring production capacity and additional resources and will fight to increase market share and sharing
the profits. Entering the industry will be easier if barriers to entry and the trend towards competitive
relationship between existing competitors are less obvious or reduced.
A depth of analysis involves study of potential related inputs and outputs within the industry,
in terms of level barriers in both cases. So:
- if both barriers - input and output - are small, stable income, but small because firms
enter and exit easily without restriction sector, there is a high risk in terms of the degree of
competition;
- if barriers to entry are low, and the output large firms enter easily when conjuncture is
favorable, but out hard in these conditions, product demand exceeds the absorption capacity of
the market, reducing the profits for all competitors;
- best and attractive sector is where barriers to entry are high and the output are small;
thus, easily penetrates and leaves the field in case of recession;
- if both barriers are high, profit potential is high, but at high risk for leaving the sector
is hampered when the growth rate of activity and the possibilities of obtaining profits are stable
or start to decrease.
2
To defend, manufacturers can choose those customers who have the least power or change
negotiations are suppliers. Or, they can offer products with superior characteristics, which customers
can not refuse too easy.
2. Strategy diferenţiere.
3
The company aims to create a special advantage, based on a single factor to be felt in the whole
area and much appreciated by customers, so they are willing to offer a premium price to use
thisadvantage. In this regard, the company will focus on delivering superior performance, to provide
leadership in the sector, in terms of one of the following attributes: quality of the products, after-sales
service and their clienţi- proposed facilities, the technology used, product originality, timeliness of
delivery, ability to adapt to changing environments and customer requirements etc. Using this strategy
requires intuition and creativity, enhanced capabilities in terms of the strengths that dis- put that
company compared with its competitors. It is possible only when acteristics characterizes the product
other than those that meet the basic need for which was created, or tele atribu- to provide firm
leadership are essential in the purchasing decision of customers. The strategy best suits the products
discovered or reputation. The company needs special marketing capabilities to enable it to identify and
understand individual customer requirements and elements of differentiation from competitors and
stbilirea possibilities for getting to meet them. Apply a targeted marketing based on differentiating
between categories of customers and creating products and marketing mixes for each target market.
The company needs special marketing capabilities to enable it to identify and understand individual
customer requirements and elements of differentiation from competitors and stbilirea possibilities for
getting to meet them. Apply a targeted marketing based on differentiating between categories of
customers and creating products and marketing mixes for each target market. The company needs
special marketing capabilities to enable it to identify and understand individual customer requirements
and elements of differentiation from competitors and stbilirea possibilities for getting to meet them.
Apply a targeted marketing based on differentiating between categories of customers and creating
products and marketing mixes for each target market.
Such a strategy is advantageous because it protects enterprise that apply:
- competitors - a poor variable price sensitive cross customer and their loyalty to the brand;
- power suppliers - high profit margins uniform grants protection on the increase in raw material
prices;
- risk of substitute products, which is low;
- threat of new entrants in the sector is low.
Risks differentiation strategy:
- not give a high market shares;
- danger of imitation is great - in these circumstances the company applying such EU's strat- egy
to be able to regularly provide new features to counter imitation products;
- trivializing the product due to its life cycle, which annihilates the effect of differentiation
strategy.
cost
environment
4
edge. small edge. big
Such a firm can not be develop by increasing production capacity, and only by opening new
branches geographically dispersed sales and specializing in small quantities.
In the second case, the company will select a demanding clientele in terms of attributes differ-
the discriminatory quality, after-sales service, technology used etc. This is because when productions
will mass and mass production, there is always a market segment that can operate a business that wants
to avoid standardized production and provide more sophisticated products that provide their owners a
particular image (eg. car Rolls Royce, Mercedes). For company will claim its customers with an added
cost that exceed the additional costs to ensure differentiating characteristics conferred products.
So the firm will choose a strategy of domination by costs in a market Oreintal to attributes of
differentiation and differentiation strategy of domination by a market-oriented reduced costs products.
The essential element of the strategy is to identify the concentration of the niche company that
RA can be successfully opera- and knowledge of target customers. Such a strategy can be used best
company wishing to enter the market.
Any strategic process must be based on one of three orientations. On this basis the company
will adopt a certain behavior from competitors, adapted to specific environmental conditions and
internal potential, developing a strATEG particular element of originality.
M. Porter's approach avoids the type behaviors, which could become a commonplace
dysfunctional (because of all the companies that use them). By this, it is superior O- dele bAzat on
portfolio activities.