Porters Five Forces
Buying power, the bargaining power of customers determines how much customers can impose pressure on margins and volume. In the case of the Crystal Corporation of the Philippines consumers have little to no bargaining power. CCP only produces this type of product to a select market; buyers from this market do not buy in large quantities or have one concentration a buyers in a single area.
The term supplier comprises all sources for input that are needed in order to provide goods or services. In the case of CCP, most of the labor is brought in from Ireland creating a demand for laborers in this type of field. The cost for the labor has rose in the past decade due to dying industry and lack of skilled laborers. Labor for the crystals make up about 70 percent of the total cost of the products that are generated.
Threats of New Substitutes
Threat from substitutes exists if there are alternative products with lower prices of better performance parameters for the same purpose. They could potentially attract a significant proportion of market volume and hence reduce the potential sales volume for existing players. In this case CCP does not have a huge threat due to lack of substitute markets. Consumers who are purchasing these products create their own market demand for the products produced from CCP. The only type of substitutes would be plastic replicas, which these consumers are not going to purchase.
Threats of New Entrants
The competition in an industry will be the higher, the easier it is for other companies to enter this industry. In such a situation, new entrants could change major determinants of the market environment (e.g. market shares, prices, customer loyalty) at any time. There is always a latent pressure for reaction and adjustment for existing players in this industry. The threat of new entries will depend on the extent to which there are barriers to entry. Due to the lack of demand initially no...