Porter's 5 Forces


The Porter’s Five Forces model is used to analyze the attractiveness of a particular industry. The analysis identifies five fundamental forces:


Porter's 5 Forces Diagram


  1. Threat of new entrants
    • How easy or difficult is it for new players to enter the market?
    • What barriers exist for new entrants?
  2. Threat of substitutes
    • How easily can the product/service be substituted?
  3. Bargaining power of suppliers
    • How strong is the position of suppliers?
    • Are there a few suppliers to choose from or many?
  4. Bargaining power of buyers
    • How strong is the position of buyers?
  5. Rivalry among existing players
    • How strong is the competition between existing players?
    • What companies dominant the industry; are most players equal in size and strength?


Use your findings to determine the attractiveness of the industry analyzed.