Determines the Level of Competitive Intensity

  1. Costs. Porter pointed out that there are specific costs that affect how intense the competition in an industry gets. …
  2. Concentration in the Industry. …
  3. Rate of Market Growth. …
  4. Differentiation. …
  5. Switching Costs. …
  6. Innovation. …
  7. Decrease in Prices. …
  8. Economic Growth.

 

A number of structural factors can affect industry rivalry:

  • Numerous or equally balanced competitors. …
  • Slow industry growth. …
  • High fixed or storage costs. …
  • Lack of differentiation or switching costs. …
  • Capacity increased in large increments. …
  • Diverse competitors. …
  • High strategic stakes. …
  • High exit barriers.

Porter’s Five Forces Model can be applied to Apple to understand its position within its industry and how it compares to the competition.

Customers, suppliers, substitutes and potential entrants—collectively referred to as an extended rivalry—are competitors to companies within an industry. The five competitive forces jointly determine the strength of industry competition and profitability.