Whole Foods Market
2 separate orders:
Order#1- Write two pages analyzing the 2 threats (Threat of (New) Entry and Threat of Powerful Supplies) for the Whole Foods Market grocery store in the United State, (in the 5 Forces Model)
Order#2- Answer all the questions provided in the attachment as a speech format. 2 pages as well.
You will only need to analyze the 2 threats attached (Threat of (New) Entry and Threat of Powerful Supplies) of the 5 external threats (as described in the Five Forces Model) that can have major effects on your company’s profitability and competitive advantages in the industry.
Five Forces Analysis
Threat of (New) Entry
Criteria/Industry Attributes Favorable to Industry Unfavorable to Industry
1. Do existing companies have cost advantages due to economies of scale? Yes No
2. Do existing companies have cost advantages independent of scale?
– Do they have cost advantages due to proprietary technology? Yes No
– Do they have cost advantages due to managerial knowhow? Yes No
– Do they have cost advantages due to favorable access to raw material? Yes No
– Do they have cost advantages due to learning curve effects? Yes No
3. Is product differentiation high? Yes No
4. Does government policy prevent entry? Yes No
Overall Threat of (New) Entry Low High
When threat is of (new) entry is high, it is harder to charge high prices, so profits are lower.
Threat of Powerful Supplies
Criteria/Industry Attributes Favorable to Industry Unfavorable to Industry
1. Is the number of suppliers small? No Yes
2. Is the suppliers’ product differentiated? No Yes
3. Are there many substitutes for the suppliers’ product? Yes No
4. Can suppliers credibly threaten to forward integrate? No Yes
5. Are industry firms an important part of suppliers’ business? Yes No
Overall Threat of Powerful Suppliers Low High
When the threat of powerful suppliers is high, costs are higher, so profits are lower.