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    Porter's Five Forces Model

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    Dokte Baulu Bangkit
    1) Porter's Five Forces model analyzes industry structure by examining five competitive forces: the threat of new entrants, the power of suppliers, the power of customers, the threat of substitutes, and competitive rivalry within the industry. 2) The document analyzes each of these forces as they apply to Yazid Burger, concluding that supplier power, customer power, and entry barriers are minimal, substitutes are moderate, and competition/rivalry is also moderate. 3) Key factors that influence Yazid Burger's industry position include their differentiated 1kg burgers, low costs, and strategic university location, though they face competition from other burger chains and street stalls.

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    Porter's Five Forces Model

    Uploaded by

    Dokte Baulu Bangkit
    534 views3 pages
    1) Porter's Five Forces model analyzes industry structure by examining five competitive forces: the threat of new entrants, the power of suppliers, the power of customers, the threat of substitutes, and competitive rivalry within the industry. 2) The document analyzes each of these forces as they apply to Yazid Burger, concluding that supplier power, customer power, and entry barriers are minimal, substitutes are moderate, and competition/rivalry is also moderate. 3) Key factors that influence Yazid Burger's industry position include their differentiated 1kg burgers, low costs, and strategic university location, though they face competition from other burger chains and street stalls.

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    Porter’s Five Forces Model

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    1) Porter's Five Forces model analyzes industry structure by examining five competitive forces: the threat of new entrants, the power of suppliers, the power of customers, the threat of substitutes, and competitive rivalry within the industry. 2) The document analyzes each of these forces as they apply to Yazid Burger, concluding that supplier power, customer power, and entry barriers are minimal, substitutes are moderate, and competition/rivalry is also moderate. 3) Key factors that influence Yazid Burger's industry position include their differentiated 1kg burgers, low costs, and strategic university location, though they face competition from other burger chains and street stalls.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    534 views3 pages

    Porter's Five Forces Model

    Uploaded by

    Dokte Baulu Bangkit
    1) Porter's Five Forces model analyzes industry structure by examining five competitive forces: the threat of new entrants, the power of suppliers, the power of customers, the threat of substitutes, and competitive rivalry within the industry. 2) The document analyzes each of these forces as they apply to Yazid Burger, concluding that supplier power, customer power, and entry barriers are minimal, substitutes are moderate, and competition/rivalry is also moderate. 3) Key factors that influence Yazid Burger's industry position include their differentiated 1kg burgers, low costs, and strategic university location, though they face competition from other burger chains and street stalls.

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    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
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    The key takeaways from the document are that Porter's Five Forces Model can be used to analyze the competitive environment of an industry. It discusses the five forces - supplier power, threat of new entrants, threat of substitutes, buyer power and competitive rivalry - and applies it to analyze Yazid Burger's industry.

    The five forces that influence an industry according to Porter's Five Forces Model are supplier power, threat of new entrants, threat of substitutes, buyer power and competitive rivalry.

    In Yazid Burger's industry, the supplier power is minimal as Yazid Burger sources raw materials from two different suppliers to overcome the economic power of suppliers and make supplier power less great.

    Porters Five Forces Model The model of pure competition implies that risk-adjusted rates of return should be constant

    across firms and industries. However, numerous economic studies have affirmed that different industries can sustain different levels of profitability. Then, part of this difference explained by industry structure. Michael Porter provided a framework that models an industry as being influenced by five forces. The strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates. Thus, this Porters Five Forces Model will be used to illustrate how well the Yazid Burger in industry. The porters five forces such as supplier power, threat of new entrant, threat of substitutes and buying power will used to evaluate the Yazid Burger performance in industry. 1- Economic Power of Customer Customer provide demand for product and service. Company will supply the product according to the demand. Thus, customers have a bargaining power, which is a form of economic power. Therefore, they can influence firms behavior. However, not all customer posses the same bargaining power. According to Porters, customers tend to exhibit greater bargaining power when they are : Few in number They make a high volume purchase The product are undifferentiated They are highly motivated to get good deals They are not concerned about the quality of what they are buying They have an information advantage compared to the firms where they buy the product or service They are well organized They can easily integrate backward and thus become their own suppliers.

    Therefore, in relation to Yazid Burgers, not all of their customers are having a great buying power. Based on the observation, customers that come to Yazids burger are many and some customer need to wait in line of queue for about 15 minute to make an order. Furthermore, the product provide by Yazid Burgers is a differentiated product. In addition, few stores provide homemade patty 1kg burgers, 500kg burgers

    and 250kg burger around Malaysia. Thus, customer did not have much choices if they want to experience a 1kg burgers in Malaysia. The Economic Power of Supplier Basically, a powerful supplier can influence the market condition. Supplier can raise the price of goods, reducing the quality of goods or service provided, or hiding stocks. In terms of Yazid Burgers, they provide a homemade burger. Yazid burger is different from other burger brand. Its 100% homemade product. They only bought from supplier the raw meat, vegetables, raw bun and other raw materials to make a sauce. Then, Mr. Yazid will process all the raw material to make a 1kg meat. Based on the interview with Mr.Yazid, he have two supplier. The reason why Mr.Yazid have to supply is that to overcome the economic power of supplier. Thus, make the supplier power less great. Entry Barriers Entry barriers refers to the degree of ease to enter the market so that, firms can predict how many new entrants can be expected. High entry barriers will lead to a lower competition. While lower entry barriers will lead to a higher competition. Yazid Burgers is different from other burger stalls. They are unique. Furthermore, their product is different from other burger seller. However, the capital requirement for new entrants to start up a business like Yazid Burgers is low. After that, the government restriction about burger stalls is low. In addition, the switching cost from this industry to others is also low. As a conclusion, the entry barriers is low. Substitute Product Substitute product is a different goods that, at least partly, satisfy the same needs of the consumers and, therefore, can be used to replace one another. Price of such goods shows positive cross-elasticity of demand. Thus, if the price of one good goes up the sales of the other rise, and vice versa. Actually, in burgers market, there are many substitute products to Yazid Burgers. Yazid Burger has come from a street stall burger. They still provide the usual burger size. Their name rose due to the 1KG burgers and advertisement through television. Thus, the other street stall burgers are still their competitor that provides a substitute product for Yazid Burgers. Furthermore, when Yazid Burger move from street stall to a building shop, they actually facing a well brand substitute burger in the world such as Mc Donald and Burger King. However, Yazid Burger is still different from the

    others local burger shop due to its 1kg burger. Their 1kg burger can be served as birthday present, family gathering and others. In addition, yazid Burgers location is strategic enough which is near to two universities in Shah Alam. Based on the research done by Yazid Burgers crew, student actually provides them a good word of mouth. As a conclusion, these forces can generate a moderate substitute to Yazid Burgers. Competition. The rivalry in 1Kg burger market is moderate. This because they are few seller of 1Kg burger around Malaysia. Furthermore, the other 1kg burger seller is not using television as their way to communicate with other customer like Yazid Burgers. Yazid burgers can dominate the market of 1Kg burger if they come with a new marketing strategy. Furthermore, 1Kg burger is a low exit market barrier. The machine need to process 1Kg meat can be buy gradually based on profit. In addition, the fixed cost of Yazid Burgers operation is low. Mr. Yazid said that, their utility bills including a store rent are about RM 1000 a month.

    Suppliers
    Suppliers Power Minimal

    Substitutes
    Substitutes Moderate

    Competition
    Rivalry is Moderate

    Customer
    Customer Power Minimal

    Entry Barriers
    The Entry

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