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michael porter proposed that business-level strategies originate with the primary competitive forces in the firm’s environment; these forces are the threats of

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According to Michael Porter, the primary competitive forces are:

  1. The threats of new market players
  2. The threat of substitute products or services
  3. Power of suppliers
  4. Power of customers
  5. Industry rivalry

1. The threats of new market players:

  • It is the threat that corresponds to the growth of a certain market, its profitability and differentiation of your product or service in relation to competitors.

2.The threat of substitute products or services:

  • It is the analysis of products that partially or totally replace your product or service and cause your market share to decrease.

3. Power of suppliers:

  • It occurs when suppliers have a monopoly on the market and dictate market rules, defining prices and terms.

4. Power of customers:

  • When the customer is able to negotiate prices and terms with a company, as in a segment with many suppliers and few customers.

5. Industry rivalry

  • The level of competition between a market that has several competitors, which will lead companies to develop competitive advantages to conquer a larger market share.

Therefore, these are Porter's 5 forces, that is, it is a methodology that aims to analyze the level of competitiveness in the market, relationship and impact on a business, helping a company to understand its strengths and weaknesses to become competitive and profitable in the long run.

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