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Dr Ita ODonovan Beechgrove Associates Dr Ita ODonovan Beechgrove Associates Lecture Eight Dr Ita O’Donovan Dr Ita ODonovan Beechgrove Associates * Dr Ita ODonovan Beechgrove Associates * The natural EnvironmentTh Demographic Structure Social Structure The Natural Environment Demographic Structure Social Structure The National/ International economy Technology Government and politics The Industry Environment Suppliers Competitors Customers Perfect Competition Oligopoly Duopoly Monopoly Dr Ita ODonovan Beechgrove Associates * Concentration Many Firms A few Firms Two Firms One firm Entry and Exit Barriers No Barriers Significant Barriers High Barriers Product Differentiation Homogeneous Product ( commodity) Potential for Product Differentiation Information Availability No impediments to information flow Imperfect availability of Information Dr Ita ODonovan Beechgrove Associates * SUPPLIERS INDUSTRY COMPETITORS Rivalry among existing firms POTENTIAL ENTRANTS SUBSTITUTES BUYERS Threat of new Entrants Threat of new substitutes Bargaining power of buyers Bargaining power of suppliers Dr Ita ODonovan Beechgrove Associates * SUPPLIER POWER Factors determining power of suppliers relative to producers; same as those determining power of producers relative to buyers- see Buyer Power Box INDUSTRY RIVALRY Concentration Diversity of competitors Product differentiation Excess capacity and exit barriers Cost conditions THREAT OF SUBSTITUTES Buyer propensity to substitute Relative prices and performance of substitutes THREAT OF ENTRY Capital Requirements Economies of scale Absolute cost advantage Product differentiation Access to distribution channels Government and legal barriers Retaliation by established producers BUYER POWER Price Sensitivity Bargaining Power Cost of product relative to total cost Size and concentration of b
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