Easyjet five forces
Threat of substitutes airline industry
For instance, another airline with even lower prices, consumers opting to use other modes of transport trains for instance. All of these factors make the threat of new entrants a weak force within this industry. When Heatrow was hit by that huge fog just before Christmas and no planes were flying, Eurostar trains were suddenly all booked. This makes the companies within the industry to push to full capacity. By rapidly innovating new products. This will be helpful in two ways. This category is particularly diverse. The access to distribution networks is easy for new entrants, which can easily set up their distribution channels and come into the business. This means that the threat of substitute products is weak within the industry. Comparatively, firms producing within the industry in which Easyjet Plc operates sell at a lower price than substitutes, with adequate quality. As a result, buyers would choose its products, which provide greater quality at a lower price as compared to substitute products that provide greater quality but at a higher price. It is hard to enter into the aircraft manufacturing industry due to the capital required to enter. Besides, the other forces involved seem to have a weak threat. A large number of companies have long-term contracts with their suppliers.
I would think, however, that for Easy Jet, there would be no big threat of substitutes. There is a threat of ever growing competition but this isn't the case of substitutes.
Based on this, the bargaining power of suppliers has a low threat as well. In addition, the industry cost structure creates large economies of scale, favouring established players, which can spread their cost on a large number of established clients.
Overall, the bargaining power of buyers has an extremely low threat in this industry. By understanding the core need of the customer rather than what the customer is buying.
Bargaining power of suppliers in airline industry
Second of all, there are no proprietary products or services involved. First of all, there are extremely low switching costs. This difficulty in switching makes the bargaining power of buyers a weaker force within the industry. Building capacities and spending money on research and development. Do consumers believe in, and to, Easy Jet? The very few competitors have a large market share. It seems to be in the mature stage of the business cycle. Threat of substitutes-this can be anything that can be a substitute to EasyJet or airline industry in general. In addition, the industry cost structure creates large economies of scale, favouring established players, which can spread their cost on a large number of established clients. Based on this, the bargaining power of suppliers has a low threat as well. Developing dedicated suppliers whose business depends upon the firm. A large number of companies have long-term contracts with their suppliers. Even considering these 2 issues, the industry still has a very low threat overall. This will help it retain its customers rather than losing them to new entrants. Threat of New Entrants Threat of new entrants is also an important aspect of the 5 forces.
It significantly reduces the window of extraordinary profits for the new firms thus discourage new players in the industry. First, there are single flyers. This makes firms within the industry reluctant to leave the business, and these continue to produce even at low profits.
The access to distribution networks is easy for new entrants, which can easily set up their distribution channels and come into the business. Who is more dependable on whom, why and to what extent?
Porters five forces
This will help it retain its customers rather than losing them to new entrants. It can provide such unique benefits to its customers by better understanding their needs through market research, and providing what the customer wants. Porter Five Forces is a holistic strategy framework that took strategic decision away from just analyzing the present competition. Some changes have been noticed lately. Talk to someone who has used Easy Jet services, ask them what they liked and disliked about it, would they use it again and why, how do they feel about Easy Jet, how did they decide to fly with Easy Jet, will they choose Easy Jet again The strategies of the firms within the industry are diverse, which means they are unique to each other in terms of strategy. A stronger force means lower profitability, and a weaker force means greater profitability. Easyjet Plc can take advantage of its economies of scale to develop a cost advantage and sell at low prices to the low-income buyers of the industry. They can identify game changing trends early on and can swiftly respond to exploit the emerging opportunity. Some carriers focus on cost, while others focus on other aspects. Even considering these 2 issues, the industry still has a very low threat overall. This way it can ensure efficiency within its supply chain. Buyers-here you can list down any possible threats from buyers. Existing companies have a large cost advantage.
They want to buy the best offerings available by paying the minimum price as possible. Why not?
based on 115 review