Cachet Technologies Case Porter’s Five Forces Analysis


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Cachet Technologies Case Study Solution

Bargaining Power of Supplier:

The distributor in the Taiwanese Cachet Technologies sector has a low negotiating power although that the industry has supremacy of 3 gamers consisting of Powerchip, Nanya and also ProMOS. Cachet Technologies manufacturers are simple initial devices makers in calculated partnerships with international players for modern technology. The 2nd reason for a low negotiating power is the fact that there is excess supply of Cachet Technologies devices because of the huge scale production of these dominant industry gamers which has lowered the price each as well as enhanced the bargaining power of the purchaser.

Threat of Substitutes & Degree of Rivalry:

The hazard of substitutes in the marketplace is high provided the fact that Taiwanese producers take on market show to international players like Intel, Motorola, IBM, Hitachi, NEC, Toshiba, Samsung and also Fujitsu. This indicates that the marketplace has a high level of competition where producers that have design and development capabilities along with making expertise might have the ability to have a higher negotiating power over the marketplace.

Bargaining Power of Buyer:

The marketplace is dominated by players like Micron, Elpida, Samsung as well as Hynix which additionally decrease the purchasing power of Taiwanese OEMs. The reality that these critical gamers do not allow the Taiwanese OEMs to have accessibility to technology shows that they have a greater bargaining power fairly.

Threat of Entry:

Threats of entry in the Cachet Technologies production sector are reduced owing to the truth that structure wafer fabs and also acquiring equipment is extremely expensive.For just 30,000 devices a month the resources demands can vary from $ 500 million to $2.5 billion depending upon the dimension of the units. The production required to be in the latest modern technology and also there for new players would certainly not be able to compete with dominant Cachet Technologies OEMs (original devices manufacturers) in Taiwan which were able to enjoy economic situations of range. Along with this the present market had a demand-supply imbalance and so surplus was already making it tough to permit new gamers to take pleasure in high margins.

Firm Strategy:

Since Cachet Technologies production utilizes basic processes as well as basic and specialty Cachet Technologies are the only 2 groups of Cachet Technologies being manufactured, the procedures can easily make usage of mass manufacturing. While this has actually led to availability of modern technology as well as scale, there has been disequilibrium in the Cachet Technologies industry.

Threats & Opportunities in the External Setting

As per the inner and also external audits, chances such as strategicalliances with modern technology companions or growth through merging/ procurement can be explored by TMC. In addition to this, an action in the direction of mobile memory is additionally a possibility for TMC especially as this is a specific niche market. Risks can be seen in the type of over dependancy on international gamers for innovation and also competition from the US as well as Japanese Cachet Technologies manufacturers.

Porter’s Five Forces Analysis