Let’s talk about Porters 5 Forces: for competitive analysis of your business & its attractiveness level. Many deceive themselves or their clients with this analysis- it’s wasted effort if it doesn’t tell you if your industry is (un)attractive from a competition standpoint. Thread 
1. Threat of new entrants: How easy is it for new players to enter your market? If the barriers to entry are low, then it means any Jack can start your business & knock you out of the market. For example, pure water business lost its juice when every one with a room started it.
Threat of subsitutes: How many subsitutes to your product exist in the market? What is their price vs. yours? How easy is it for customers to switch? Do you really have a strong USP that can retain customers despite them? What is your competitive advantage? Is it even worth it?
Bargaining power of buyers: Who are your customers? How strong is their purchasing power? Are they able to influence or force your price points? An example of this is how sales of bottle water crashed when price increased to N70. And forced non-majors to revert to N50.
Bargaining power of suppliers: who are your suppliers? How powerful are they? Are you able to influence or negotiate prices of your raw materials to drive down your costs to the benefit of your price? How easy is it for you to get alternative suppliers at competitive price?
Rivalry amongst existing competitors: If existing industry competition is already high, toxic and brutal, then you know it will impact on the attractiveness of such industry. It means you have to be ready for war. My article here best sheds light on this: businessday.ng/opinion/articl…
So the final output of the analysis must rate the forces between high to low. if all negative forces are high & positive forces low, the industry may not be attractive. Or moderately attractive & require certain strategies to survive. But your analysis must cover such a plan. End
