Polar Sports Inc Case Porter’s Five Forces Analysis


Home >> Harvard >> Polar Sports Inc >> Porters Analysis

Polar Sports Inc Case Study Analysis

Bargaining Power of Supplier:

The distributor in the Taiwanese Polar Sports Inc sector has a low negotiating power although that the industry has prominence of 3 gamers including Powerchip, Nanya and ProMOS. Polar Sports Inc suppliers are mere original devices makers in tactical partnerships with international players in exchange for innovation. The second factor for a low negotiating power is the fact that there is excess supply of Polar Sports Inc systems as a result of the huge scale production of these dominant market players which has reduced the cost per unit and raised the negotiating power of the buyer.

Threat of Substitutes & Degree of Rivalry:

The risk of substitutes on the market is high provided the truth that Taiwanese manufacturers compete with market show to international gamers like Intel, Motorola, IBM, Hitachi, NEC, Toshiba, Samsung and also Fujitsu. This shows that the marketplace has a high degree of rivalry where producers that have layout and also development abilities together with manufacturing know-how might be able to have a higher bargaining power over the marketplace.

Bargaining Power of Buyer:

The market is controlled by players like Micron, Elpida, Samsung as well as Hynix which better reduce the purchasing power of Taiwanese OEMs. The truth that these strategic gamers do not allow the Taiwanese OEMs to have accessibility to innovation shows that they have a higher negotiating power comparatively.

Threat of Entry:

Dangers of entrance in the Polar Sports Inc manufacturing industry are low owing to the reality that structure wafer fabs and acquiring tools is highly expensive.For simply 30,000 devices a month the resources needs can range from $ 500 million to $2.5 billion relying on the dimension of the systems. The production required to be in the most recent technology as well as there for brand-new gamers would certainly not be able to compete with leading Polar Sports Inc OEMs (initial tools manufacturers) in Taiwan which were able to appreciate economies of range. The current market had a demand-supply discrepancy and also so excess was currently making it hard to enable new gamers to appreciate high margins.

Firm Strategy:

The area's manufacturing firms have actually counted on an approach of automation in order to lower prices with economic situations of scale. Considering that Polar Sports Inc manufacturing makes use of conventional processes and also typical and specialty Polar Sports Inc are the only two groups of Polar Sports Inc being produced, the procedures can easily use mass production. The market has leading manufacturers that have actually created partnerships in exchange for technology from Korean and also Japanese firms. While this has brought about availability of technology and also range, there has actually been disequilibrium in the Polar Sports Inc market.

Threats & Opportunities in the External Environment

Based on the internal as well as external audits, possibilities such as strategicalliances with innovation partners or development with merger/ procurement can be explored by TMC. A move in the direction of mobile memory is additionally an opportunity for TMC especially as this is a particular niche market. Dangers can be seen in the kind of over dependancy on international players for innovation as well as competitors from the US and also Japanese Polar Sports Inc producers.

Porter’s Five Forces Analysis