Porter's Five Forces
What are Porter’s Five Force? Porter’s Five Force is a model that identifies and analyses five competitive forces that shape every industry. The Five Forces model is named after Harvard Business School professor, Michael E. Porter. It helps analyzing the level of competition within a certain industry. It also helps determine an industry's weaknesses and strengths. Porter's model can be applied to any segment of the economy to understand the level of competition within the industry and enhance a company's long-term profitability. The collective strength of these forces determines the profit potential of an industry and thus its attractiveness. Understanding Porter’s Five Forces Porter's five forces include three forces from 'horizontal' competition – competition rivalry, the threat of new entrants and the threat of substitute products or services – and two others from 'vertical' competition – the bargaining power of suppliers and the bargaining pow...