Porter's Five Forces

5.1 Rivalry

In the traditional economic model, competition among rival firms drives profits to zero. But competition is not perfect and firms are not unsophisticated passive price takers. Rather, firms strive for a competitive advantage over their rivals. The intensity of rivalry among firms varies across industries, and strategic analysts are interested in these differences. Rivalry in this industry can consider as high, because the number of competitor are making more and more in this society, even some of the competitors are huge firm, such as Roofers and WeatherScope, these companies has abundant capital, worker has a broad range of work experiences, each company has hold 8-13% in this industry.

5.2 Threat of Substitutes

The presence of substitute products can lower industry attractiveness and profitability because they limit price levels. The threat of substitute products depends on few reasons such as buyers' willingness to substitute, the relative price and performance of substitutes and the costs of switching to substitutes. For roof build company, the threat of substitutes can be considering as high, for example, tarpaulins are widespread to used in nowadays. Compare with the roof, tarpaulin is cheaper and easier to build up. Especially in some event, will rather to use tarpaulin because it can be temporary, pragmatic, save more manpower and time, therefore, the cost of switching also will be lower than roof.

5.3 Bargain Power of Buyer

Buyers are the people or organizations who create demand in an industry. The bargaining power of buyers is greater when there are few dominant buyers and many sellers in the industry. Products are standardized are also increase bargain of buyers. When the industry is not a key supplying group for buyers, buyers will be more powerful too. According to these conditioning, the bargain power of buyer will be consider as high, because there are many sellers in this industry, customers will make compare to another companies...