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Penn West Petroleum Ltd Case Porter’s Five Forces Analysis

CASE STUDY

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Penn West Petroleum Ltd Case Study Analysis

Bargaining Power of Supplier:

The distributor in the Taiwanese Penn West Petroleum Ltd industry has a reduced negotiating power although that the sector has prominence of three gamers including Powerchip, Nanya as well as ProMOS. Penn West Petroleum Ltd suppliers are plain initial tools makers in calculated partnerships with foreign gamers for innovation. The 2nd reason for a low bargaining power is the reality that there is excess supply of Penn West Petroleum Ltd devices as a result of the big scale production of these leading market gamers which has actually reduced the rate per unit as well as raised the negotiating power of the customer.

Threat of Substitutes & Degree of Rivalry:

The risk of alternatives in the market is high offered the reality that Taiwanese suppliers compete with market share with global players like Intel, Motorola, IBM, Hitachi, NEC, Toshiba, Samsung and also Fujitsu. This indicates that the market has a high degree of rivalry where producers that have design and also development abilities together with manufacturing experience may be able to have a greater bargaining power over the market.

Bargaining Power of Buyer:

The marketplace is controlled by players like Micron, Elpida, Samsung as well as Hynix which better reduce the buying powers of Taiwanese OEMs. The fact that these critical players do not permit the Taiwanese OEMs to have accessibility to innovation indicates that they have a higher bargaining power somewhat.

Threat of Entry:

Risks of entry in the Penn West Petroleum Ltd production sector are low because of the fact that structure wafer fabs and purchasing equipment is extremely expensive.For simply 30,000 systems a month the capital needs can range from $ 500 million to $2.5 billion relying on the dimension of the units. The production needed to be in the most current innovation and also there for new players would not be able to contend with dominant Penn West Petroleum Ltd OEMs (original tools suppliers) in Taiwan which were able to delight in economies of scale. In addition to this the current market had a demand-supply imbalance and so excess was already making it hard to allow new gamers to delight in high margins.

Firm Strategy:

The region's manufacturing firms have depended on a strategy of mass production in order to reduce expenses through economies of range. Given that Penn West Petroleum Ltd production uses common processes as well as common as well as specialty Penn West Petroleum Ltd are the only 2 categories of Penn West Petroleum Ltd being produced, the processes can quickly utilize mass production. The market has dominant producers that have formed alliances for innovation from Oriental and also Japanese companies. While this has actually resulted in accessibility of technology as well as scale, there has actually been disequilibrium in the Penn West Petroleum Ltd industry.

Threats & Opportunities in the External Atmosphere

As per the inner and external audits, chances such as strategicalliances with modern technology companions or growth with merger/ purchase can be checked out by TMC. A relocation towards mobile memory is also a possibility for TMC especially as this is a specific niche market. Dangers can be seen in the kind of over reliance on international gamers for innovation and competitors from the US and Japanese Penn West Petroleum Ltd producers.

Porter’s Five Forces Analysis