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Mark and Spenser Company deals with clothing and are planning venturing into Kenyan market. The management team has appointed you as their business consultant. Using...

Case Analysis

Answers

Antony
Porter's five force model uses five forces in the industry to examine the level of profitability and the intensity of competition. The five forces are the threat of entry, suppliers bargaining power, the threat of substitutes, bargaining powers of buyers, and industry rivalry. Warnings on new entrants measure how easy it is to enter a particular industry. The clothing Industry in Kenya is not highly regulated. Mark and Spenser Company can easily access the market.
Suppliers bargaining power addresses the easiness of suppliers to drive up the price of raw materials. Kenya clothing sector faces a weak supplier's power due to multiple supplier channels and the lower cost of switching the raw materials. On the other hand, consumers bargaining force deals with the customers' ability to influence price movement. Potential customers in Kenya like in most developing nations are price sensitive and more likely to turn to other providers in the event of higher rates.
The threat of substitutes constitutes the availability of alternative products or service that can be used instead of those produced by the organization. There are no alternatives to clothing in Kenya; they only differ in the make, fashion, and individuals’ preference. Finally, competition rivalry depends on the number of competitors as well as their ability to push the existing entity out of business. Clothing sector is very competitive due to deregulation. There is stiff competition from local, regional and international companies. Due to little barriers of entry and lack of alternatives to clothing, I advise Mark and Spenser Company to explore the Kenyan market
simpleman Anto answered the question on February 8, 2018 at 11:51

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