The airline industry
- Identify the type of players there are in each of the forces:
- Who could enter the industry?
- What customers are served?
- What suppliers are used?
- What are the substitutes?
- Who are the rivals?
- For each force, study the characteristics that make it strong
- Evaluate the strength of each force
- Understand how the forces interact with each other
Evaluation of the forces in the airline industry
- Entry barriers: low due to low entry requirements
- Supplier power: strong due to few key players
- Buyer power: high due to low switching costs and real-time price information
- Substitutes: readily available (trains, cars, …)
TLC industry in India
→ in the mobile communication industry in India there are >1.1 billion phone accounts
→ really concentrated → CR_4 = 0.99, HI = 0.28
As a consequence the industry is not profitable at all
- costly infrastructure
- low prices as income per capita is low
- government also wanted low prices (PESTEL)