Five Forces

Supplier power is where you assess how easy it is for suppliers to drive up prices. This is usually driven by the number of suppliers, the uniqueness of the product or service, their strength and control over you and the cost of switching from one to another. For our market there are a large number of suppliers and we are choosing specific pieces of our choice. This will mean prices should remain low as supplier’s competition is high.

Buyer power is how easy it is for buyers to drive prices down. This is driven by the number of buyers, the importance of each individual buyer to your business and the cost to them of switching from your products and services to those of someone else. As we are in an affluent area and using the store as convenience for people our prices should not be dictated too much from our buyers.

Competitive rivalry is the number and capability of your competitors. If you have many competitors, and they offer equally attractive products and services, then you'll most likely have little power in the situation, because suppliers and buyers will go elsewhere if they don't get a good deal from you. For our business however as we are using one off pieces people cannot look elsewhere for these products so our store should once again hold the authority over the pricing.

Threat of Substitution is when your product or service is affected by the ability of your customers to find a different way of doing what you do or selling what you sell. In bath there is different art dealers however they will sell different items. Our company will have to make sure the one off items we chose are going to be in demand and match our competitors for style and quality.

Threat of new entry is affected by the ability of people to enter your market. If it costs little in time or money to enter your market and compete effectively, if there are few economies of scale in place, or if you have little protection for your key technologies, then new competitors can quickly...