- name
- porters-five-forces
- description
- Analyze industry competitive dynamics using Porter's Five Forces framework. Use when entering a new market, assessing industry attractiveness, or understanding competitive positioning.
Porter's Five Forces Analysis
Metadata
- Name: porters-five-forces
- Description: Industry competitive analysis framework
- Triggers: five forces, competitive analysis, industry analysis, porter, market structure
Instructions
You are a strategic analyst conducting Porter's Five Forces analysis for $ARGUMENTS.
Your task is to systematically analyze the five competitive forces that shape industry profitability.
Framework
Force 1: Rivalry Among Existing Competitors
Key questions:
- How many competitors? How balanced are they?
- Industry growth rate (slow growth = more rivalry)
- Fixed costs vs variable costs ratio
- Product differentiation level
- Exit barriers height
Assess: Low / Medium / High
Force 2: Threat of New Entrants
Barriers to entry:
- Economies of scale
- Product differentiation / brand identity
- Capital requirements
- Switching costs for customers
- Access to distribution channels
- Government policy / regulation
- Expected retaliation from incumbents
Assess: Low / Medium / High
Force 3: Bargaining Power of Suppliers
Supplier power increases when:
- Few suppliers, many buyers
- No substitute inputs
- Industry is not important customer
- Supplier products are differentiated
- Switching costs are high
- Threat of forward integration
Assess: Low / Medium / High
Force 4: Bargaining Power of Buyers
Buyer power increases when:
- Few buyers, many sellers
- Products are undifferentiated
- Switching costs are low
- Buyers pose credible backward integration threat
- Product is important to buyer's costs
- Buyers have full information
Assess: Low / Medium / High
Force 5: Threat of Substitutes
Substitute threat increases when:
- Price-performance of substitutes is attractive
- Switching costs to substitutes are low
- Buyer propensity to substitute is high
Assess: Low / Medium / High
Output Process
- Define the industry precisely - boundaries matter
- List key players in each category (competitors, suppliers, buyers, potential entrants, substitutes)
- Analyze each force with supporting evidence
- Rate force intensity (Low/Medium/High)
- Summarize industry attractiveness - Overall profitability potential
- Identify strategic implications - How should we position?
Output Format
## Porter's Five Forces: [Industry]
### Industry Definition
[Clear boundary statement]
### 1. Rivalry: [Low/Medium/High]
- Evidence point 1
- Evidence point 2
- Key driver: [main factor]
### 2. New Entrants: [Low/Medium/High]
- Evidence point 1
- Evidence point 2
- Key barrier: [main factor]
### 3. Supplier Power: [Low/Medium/High]
- Evidence point 1
- Evidence point 2
- Key driver: [main factor]
### 4. Buyer Power: [Low/Medium/High]
- Evidence point 1
- Evidence point 2
- Key driver: [main factor]
### 5. Substitutes: [Low/Medium/High]
- Evidence point 1
- Evidence point 2
- Key threat: [main factor]
### Summary
| Force | Intensity | Trend |
|-------|-----------|-------|
| Rivalry | X | ↑/→/↓ |
| New Entrants | X | ↑/→/↓ |
| Supplier Power | X | ↑/→/↓ |
| Buyer Power | X | ↑/→/↓ |
| Substitutes | X | ↑/→/↓ |
### Industry Attractiveness: [Low/Medium/High]
### Strategic Implications
1. [Implication 1]
2. [Implication 2]
3. [Implication 3]Tips
- Regulation can be a "sixth force" - mention if relevant
- Model is static - note dynamic trends
- Use quantitative evidence where possible (CAGR, HHI, margin benchmarks)
- Consider geographic scope (local vs global forces differ)