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This blog post is about Porters Five Forces Assignment Help, in which we are sharing information with real organisation's analysis that is Starbucky Coffee. first i tell you porters five forces model is important to analyse micro and macro environmental factors.
Porter’s Five Force Model
This model helps in the industry analysis and in developing a business strategy. These five forces are also called as micro-environmental factors. It helps in studying the bargaining power of customers and suppliers and also three forms of competitors which are already established rival, new entrants and substitutes. Following is porter’s five force model analysis of Starbucks:
Threat of New entrants: Entry in premium coffee retail sector is not an easy task as it requires lots of money and research. It is not easy to attract customers from other competitors. Starbucks has first mover advantage in this sector. So threat of new entrants is very minimal for Starbucks.
Bargaining Power of customers : Starbucks has already maintained a very consistent level of number of customers and Starbucks has built itself as premium coffee brand. Having Starbucks coffee is like a status symbol for buyers. There are very less options for buyers in premium coffee market. So Starbucks is safe from this angle also.
Bargaining power of suppliers : Suppliers have strong bargaining power as the entire business depends upon the quality of beans provided by the farmers. Starbucks has to have very strong relationship with its suppliers and it should encourage mutual growth.
Threat of substitute products : Restaurants and street coffee vendors can be the substitute to coffee. Starbucks has to focus on the service and quality of its products to differentiate itself from these threats because it is not possible for Starbucks to match them with the price.
Threat of rivals : McDonald’s Mccafe, Dunkin Donuts and Café Coffee Day are the major competitors of Starbucks. Starbucks has maintained competitive advantage with the help of its service and ambience in the stores. So threat is not as huge. Starbucks should focus on its basics i.e. quality of coffee and service and it will beat its customers.