Business
Can the Five Forces model assist AirAsia to analyze low cost strategy effectively?
Introduction
To begin with the purpose of this essay will analyze that can the Five Forces model assist Air Asia to analyze low cost strategy effectively. Firstly, the discussion of this essay will explain the model of five forces. Afterwards, in order to make points clearly and demonstrate helpfully, there will be an analysis of a company, which is from airline industry, named Air Asia. In addition, it will analyze the current situations and measures of Air Asia about low cost strategy. Finally, there gives a conclusion that summarizes the aspects analyzed on the essay. This essay aims at analyzing low cost strategy of Air Asia by five forces, to put this model into practice and illustrate its usage and value.
Five Forces
Five forces model had created by Michael Porter in 1979, this is a model analyzes competitive factors and helps managers to determine strategy which is related to profits indirectly. Five forces includes five key areas, they are suppliers bargaining power, buyer bargaining power, potential new entrants, threat of substitute product and the rivalry among competing sellers.(Porter, 1979)
Initially, five forces analyze the opportunity, risk and profitability within a given industry based on five key elements in an objective and neutral way. Secondly, this model is suitable for analyzing general industry, such as a company comes from airline industry, however except non-profit firms. Thirdly, five forces contributes to SWOT model at macro level, it provides the external factors for the aspect of strength. In this essay, it argues that what the most helpful element dedicated to low cost is.
Air Asia
The airlines have brought a significant change to people’s daily life. In specific, it has greatly reduced traveling time and gave a convenience to travel from land to land. Air Asia, comes from Malaysia and established on 12th December 2001, it is a
Introduction
To begin with the purpose of this essay will analyze that can the Five Forces model assist Air Asia to analyze low cost strategy effectively. Firstly, the discussion of this essay will explain the model of five forces. Afterwards, in order to make points clearly and demonstrate helpfully, there will be an analysis of a company, which is from airline industry, named Air Asia. In addition, it will analyze the current situations and measures of Air Asia about low cost strategy. Finally, there gives a conclusion that summarizes the aspects analyzed on the essay. This essay aims at analyzing low cost strategy of Air Asia by five forces, to put this model into practice and illustrate its usage and value.
Five Forces
Five forces model had created by Michael Porter in 1979, this is a model analyzes competitive factors and helps managers to determine strategy which is related to profits indirectly. Five forces includes five key areas, they are suppliers bargaining power, buyer bargaining power, potential new entrants, threat of substitute product and the rivalry among competing sellers.(Porter, 1979)
Initially, five forces analyze the opportunity, risk and profitability within a given industry based on five key elements in an objective and neutral way. Secondly, this model is suitable for analyzing general industry, such as a company comes from airline industry, however except non-profit firms. Thirdly, five forces contributes to SWOT model at macro level, it provides the external factors for the aspect of strength. In this essay, it argues that what the most helpful element dedicated to low cost is.
Air Asia
The airlines have brought a significant change to people’s daily life. In specific, it has greatly reduced traveling time and gave a convenience to travel from land to land. Air Asia, comes from Malaysia and established on 12th December 2001, it is a
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