Olympic Financial Ltd Case Porter’s Five Forces Analysis


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Olympic Financial Ltd Case Study Solution

Bargaining Power of Supplier:

The distributor in the Taiwanese Olympic Financial Ltd sector has a reduced bargaining power despite the fact that the industry has dominance of three gamers consisting of Powerchip, Nanya and ProMOS. Olympic Financial Ltd manufacturers are mere original equipment makers in critical alliances with international players in exchange for modern technology. The second reason for a reduced negotiating power is the fact that there is excess supply of Olympic Financial Ltd devices due to the large range production of these leading industry gamers which has actually decreased the rate each and increased the bargaining power of the purchaser.

Threat of Substitutes & Degree of Rivalry:

The threat of replacements out there is high given the fact that Taiwanese producers compete with market show to international players like Intel, Motorola, IBM, Hitachi, NEC, Toshiba, Samsung and Fujitsu. This shows that the market has a high degree of competition where suppliers that have layout as well as advancement abilities in addition to manufacturing proficiency may be able to have a higher negotiating power over the marketplace.

Bargaining Power of Buyer:

The marketplace is dominated by gamers like Micron, Elpida, Samsung and Hynix which additionally lower the buying powers of Taiwanese OEMs. The reality that these tactical players do not enable the Taiwanese OEMs to have accessibility to technology shows that they have a greater negotiating power somewhat.

Threat of Entry:

Hazards of entry in the Olympic Financial Ltd production sector are low owing to the fact that structure wafer fabs and also purchasing devices is extremely expensive.For simply 30,000 devices a month the resources requirements can vary from $ 500 million to $2.5 billion depending upon the dimension of the units. The manufacturing needed to be in the newest technology and there for new players would certainly not be able to compete with leading Olympic Financial Ltd OEMs (initial tools manufacturers) in Taiwan which were able to appreciate economies of scale. The current market had a demand-supply inequality and so surplus was currently making it hard to allow new gamers to enjoy high margins.

Firm Strategy:

Given that Olympic Financial Ltd manufacturing uses common procedures and conventional and specialized Olympic Financial Ltd are the only 2 categories of Olympic Financial Ltd being manufactured, the procedures can easily make usage of mass production. While this has actually led to schedule of technology and range, there has been disequilibrium in the Olympic Financial Ltd industry.

Threats & Opportunities in the External Setting

As per the interior as well as exterior audits, opportunities such as strategicalliances with modern technology companions or development through merger/ acquisition can be discovered by TMC. In addition to this, a step in the direction of mobile memory is additionally a possibility for TMC specifically as this is a niche market. Dangers can be seen in the kind of over reliance on foreign players for technology as well as competitors from the United States and Japanese Olympic Financial Ltd producers.

Porter’s Five Forces Analysis