Question

According to Porter’s Five Forces Model, ____ is low when customers have more options.Group of answer choices A. supplier power B. buyer power C. new entrant power D. competitor power

Answer 1

According to Porter’s Five Forces Model, buyer power is low when customers have more options.

Step-by-step explanation:

According to Porter’s Five Forces Model, buyer power is low when customers have more options. Buyer power refers to the ability of customers to influence pricing and terms in a market. When customers have numerous alternatives to choose from, they can easily switch to another supplier if they are dissatisfied, reducing their power and leverage over pricing and terms.

Answer 2

Buyer power in Porter’s Five Forces Model is low when there are more options for customers, indicating a competitive market with less individual customer influence over companies. This aspect of the model helps assess the competitive intensity and market dynamics faced by firms.

Step-by-step explanation:

According to Porter’s Five Forces Model, buyer power is low when customers have more options. Buyer power is the ability of customers to put the company under pressure and it also affects the competitive environment and profit potential of the firm. A high level of buyer power creates an environment where there are more choices for consumers, so each individual customer has less influence over companies.

When looking at the Five Forces Model, it's important to assess several factors to understand the dynamics of the competitive environment. Questions such as "How much market power does each firm in the industry possess?" or "Do firms compete on the basis of price, advertising, or other product differences?" help in determining the intensity of competitive rivalry which can greatly affect a firm's strategy.