Porter Forces over Tyson

Topics: Meatpacking, Competition, Industrial agriculture Pages: 2 (565 words) Published: March 24, 2009
Real Threat of new Entrants
When deciding on entering an industry as a new company one must be aware of the borrow costs of bank loans and credit rates. The meat packing and manufacturing industry is not easy to break into although it can be done.

Real Threats of Substations Product or Services
The threat of substation is high due to the fact that so many competitors are in this market. This type of saturation in the market even affects the level of competition. That doesn’t mean that it affect substation necessarily, because if a substitution would occur it would most likely be the type of meat not the producing and packing company.

Bargaining Power of Suppliers
The market is dominated by a number of large suppliers rather than a fragmented source of supply, this gives suppliers the power to set and control price. This means that the industry lacks the type of competition that affects price directly, because of the high number of real competitors and the unlikelihood of vertical integration the industry is constantly improving quality.

Bargaining Power of Buyers
The bargaining power of buyers in the industry is low. Buyers are not going to be able to negotiate much with an industry that has such a high level of activity. This means that is not very often the buyer has much power in an industry that being mostly dominated by the major suppliers, who control the power in the market.

Intensity of Rivalry and competitive forces of
Competitors in industry
This industries is very competitive, this usually means that companies within this industry are likely to suffer lower returns due to the expenses associated with competing. The more competition the more brand loyalty comes into effect. This is when the quality of the product being produced and packaged comes into play.

Implication of the Competitive Forces and Rivalry
The five forces reveal why industry profitability is so important. Now our company incorporates industry conditions into...
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