GK
BUSINESS MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Threat of Substitution
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determines the ability and likelihood of customers finding another way to either make or provide the services or products a company offers
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the amount of power a company has in the market in relation to their competitors
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pertains to how much power customers have as far as driving down the prices of products and services
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pertains to how much power a supplier has as far as increasing the prices of supplies and merchandise a company purchases from them
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helps companies to analyze their industry and determine their level of competitiveness
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Explanation:
Detailed explanation-1: -What is the Threat of Substitution? Companies are concerned that substitute products or services may displace their own. The threat of substitution is high when rivals, or companies outside the industry, offer more attractive and/or lower cost products.
Detailed explanation-2: -Threat of substitutes (from Porter’s five forces analysis) occurs when companies within one industry are forced to compete with industries producing substitute products or services. Threat of substitutes is one of the five forces that determine the intensity of competition in an industry.
Detailed explanation-3: -Threat of Substitution This refers to the likelihood of your customers finding a different way of doing what you do.
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