Nothing Special   »   [go: up one dir, main page]
Scribd Logo
Upload

Welcome to Scribd!

  • 555 views

    Porter's 5 Forces in Food Retail

    Uploaded by

    Randy Lahey
    Porter's 5 Forces analysis is applied to the food retail industry. There is fierce industry rivalry due to limited product differentiation and low switching costs. New entrants are frequent but many fail due to lack of economies of scale. Substitutes like food service are only occasional alternatives. Supplier power is high for large food manufacturers but low for local farmers. Buyer power is increased by lack of switching costs and limited product differences. Supplier power has a major impact through pricing, product development, and supply chain integration, making suppliers integral to grocery business models.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Porter's 5 Forces in Food Retail

    Uploaded by

    Randy Lahey
    555 views5 pages
    Porter's 5 Forces analysis is applied to the food retail industry. There is fierce industry rivalry due to limited product differentiation and low switching costs. New entrants are frequent but many fail due to lack of economies of scale. Substitutes like food service are only occasional alternatives. Supplier power is high for large food manufacturers but low for local farmers. Buyer power is increased by lack of switching costs and limited product differences. Supplier power has a major impact through pricing, product development, and supply chain integration, making suppliers integral to grocery business models.

    Original Description:

    Original Title

    Porter’s 5 Forces in Food Retail

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Porter's 5 Forces analysis is applied to the food retail industry. There is fierce industry rivalry due to limited product differentiation and low switching costs. New entrants are frequent but many fail due to lack of economies of scale. Substitutes like food service are only occasional alternatives. Supplier power is high for large food manufacturers but low for local farmers. Buyer power is increased by lack of switching costs and limited product differences. Supplier power has a major impact through pricing, product development, and supply chain integration, making suppliers integral to grocery business models.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    555 views5 pages

    Porter's 5 Forces in Food Retail

    Uploaded by

    Randy Lahey
    Porter's 5 Forces analysis is applied to the food retail industry. There is fierce industry rivalry due to limited product differentiation and low switching costs. New entrants are frequent but many fail due to lack of economies of scale. Substitutes like food service are only occasional alternatives. Supplier power is high for large food manufacturers but low for local farmers. Buyer power is increased by lack of switching costs and limited product differences. Supplier power has a major impact through pricing, product development, and supply chain integration, making suppliers integral to grocery business models.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 5

    Porter’s 5 Forces in Food Retail

    JDCC Knowledge Sharing

    Thomas Dixon

    1
    Porter’s 5 Forces
    Industry Rivalry
    ▪ Fierce due to limited
    product differentiation &
    New Entrants negligible switching costs

    ▪ Frequent new entrants Supplier Power


    due to demand for food ▪ High with large food
    innovation and manufacturers
    emergence of niches ▪ Low with local
    ▪Threat
    Low entry
    of New & exit costs farmers and small
    ▪ Many fail to due lack of
    Entrants food manufactures
    economies of scale

    Substitutes Buyer Power


    ▪ Food service only real ▪ Higher buyer power
    substitute due to lack of
    ▪ Not a full alternative – switching costs and
    more an occasional limitations in product
    option differentiation

    2
    Key Force: Supplier Power

    Degree of supplier power is driven by consumer demand

    Consumer demand a product = Forces retailer to offer it in store

    Examples:

    Suppliers with strong brands have more power

    Suppliers with differentiated products consumers love have more power

    3
    Key Force: Supplier Power Impact
    Why is this an Important Force?

    Suppliers impact price inflation for food products


    Impact: Pricing and margins

    Suppliers drive new product development for grocers


    Impact: Sales and market share growth

    Supply chain efficiency and integration with distribution impacts market


    expansion
    Impact: Sales, market share growth and margins

    Suppliers are an integral component of the grocery store business model

    4
    Sources
    Resources to Reference:
    • MarketLine Industry Profile: Food & Grocery Retail in the United States
    • IBIS World: Supermarkets & Grocery Stores in the US
    • IBIS World: Fruit & Vegetable Markets in the US
    • McKinsey Retail Insights

    You might also like