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Furniture industry Porter's 5 Analysis

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Iryna Mozil

on 18 February 2013

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Transcript of Furniture industry Porter's 5 Analysis

Power of Suppliers Power of suppliers is relatively low, there is a wide range of providers of raw materials, also it should be mentioned that not only wood can be used for production, but other materials, like pressed, wood dust, plastic or metal. Substitute products There are no substitute products to furniture, it is quite hard to imagine that people are going to store their clothes in boxes or sleep on the floor. :) Rivalry Threats of New Entrants Threat of new entrants is possible, it is not hard to start own furniture production even for small enterprises or private handmade entrepreneurs, especially if to take into account that the demand is high for furniture, there are no substitute products and power of suppliers is not high. On the other hand to become a big multinational brand like IKEA will be very hard and expensive. It will take a lot of money and time to establish production and retail spots all over the world. Power of Buyers Power of buyers is low because there are no substitute products, customers may choose only among the industry, but they can not find anything instead of furniture. Porter's 5 Forces analysis Furniture industry Rivalry among industry is quite high, there are several big companies that provide the same products in CZ, for example Mobelix, Sconto, KIKA, IKEA, Asko, as well as small local producers.
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