Competitive Model

Topics: Competition, Department store, Marketing Pages: 4 (1154 words) Published: September 3, 2012
Discuss Hua Ho Departmental Store Competitiveness based on Porter’s 5 Competitive Model Forces. This is similar to Case study discussed in class.

Hua Ho Department Store was founded by Yang Dimuliakan Pehin Kapitan China Kornia Diraja Lau Gim Kok in 1947. Since then, the business has expanded rapidly in Brunei Darussalam. In addition to that, Pehin Dato Lau has set up several Hua Ho Agricultural Farms to supply vegetables, fruits, chickens and eggs.

Hua Ho Department store is the most established retail business in this country. With over 60 years of milestone, it sprung up into nine outlets (including the mini-mart) in Brunei. The different outlets are located at Sengkurong, Gadong, Kiulap, Yayasan, Delima, Manggis, Tanjong Bunut and Tutong in chronological order. Hua Ho Department Store have brought to the people of Brunei the top international brands in sports, fashion, household, active lifestyle and food products and provides its customers a one-stop shopping experience.

Hua Ho Department Store : Using The Competitive Forces.

* Threat of new competition

A profitable industry will attract more competitors looking to achieve profits. If it is easy for these new entrants to enter the market if entry barriers are low, this poses a threat to the firms already competing in that market. More competition or increased production capacity without an increase in consumer demand means less profit. According to Porter’s 5 forces, threat of new entrant’s definition revolutionized the way people look at competition in an industry.

The threat of new entrants porter created affects the competitive environment for the existing competitors and influences the ability of existing firms to achieve profitability. A high threat of entry means new competitors are likely to be attracted to the profits of the industry and can enter the industry with ease. New competitors entering the marketplace can threaten or decrease the market share...
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