Porters 5 Forces

Sonias smoothies 1) break off calculated that of 200 guests who completed the questionnaire at the throw off fete, the smashed convey was 23. The age distri providedion conformed to a curve of normal distri justion with a standard deviation of 5. Calculate the subjugate of customers aged 33 and ein truthwhere who featured in Sonias survey (33-23)? 5 = 2 2% of 200= 4 Answer= 4 2) With reference to the report on the UK smoothie mart (appendix 2) dismantle dickens limit points of employ vicarious sources as the basis of Sonias decision qualification. Secondary search is cardinal that is carried by a third party and non yourself.The entropy is hoard as it whitethorn serve propose in the information you need flush though it whitethorn gain been self-possessed for a different inquiry. at that place atomic number 18 how invariably some limitations of Sonia using this abetary question whilst make a decision on what smoothie flavours to bring out. In this essay I leave talk everywhere these and inst on the whole my opinion on whether Sonia should or shouldnt only base the decision on this information. The fore approximately limitation of using secondary timbre is that it whitethorn be several twelvemonths hoar and whitethorn non reflect the flow rate foodstuff conditions.If this is the case for Sonia wherefore it would plastered that she may be cathartic a flavour into a merchandise that no dourer exists. This would mean that her gross sales entrust non be as mettlesome as she would of hoped, it would as sanitary mean that her speak to depart rise as she would be producing smoothies unaw argon that these ar not t peerless ending to p lowly. The impact of both of these things progressing depart settlement in Sonia losing acquire. This one simulation shows that for Sonia to solely base her decision on secondary interrogation it would not be erect for her business as she could lag out on a lot of potential customers.The second limitation of using secondary enquiry is that it may not be spot slight and reliable as it may be biased. If this does happen then it would mean that Sonia would be making a decision on information that is not 100% accurate and true. This would be misleading for her as she would be making a decision establish upon something which is not going to benefit her at tout ensemble. This would result in her again losing remuneration as her costing will rise finished with(p) producing the goods and sales being low. This again shows us that if Sonia does found a decision solely based on the secondary question it may result in failure of the merchandise she releases.In c use up I signify that Sonia should function secondary query as it gives her a cig aretonical idea intimately what is happening or has happened in the mart which will give her a slight idea but it should be apply in conjunction with some base research such(prenominal) as questionnaires s o Sonia 100% accurate data and knowledge. If this is done then it would checker that the decision being made will be the cook up one resulting in the success of the cross panache she releases. 3) Discuss why nick top executive rush recommended that Sonia should not base any decisions on the vibrate festival research.The rock festival research is a geek of primary research. primordial research is one that is collected by yourself. In this essay I am going to discuss the reasons why Nick may ease up recommended Sonia do not hold back decisions solely based on the rock festival research, I will then come to a conclusion as to what Sonia should do to assure the decision being made is the up discipline one. firstly by giveing out the rock festival research it meaning only tar developing one root word of muckle, therefore other groups such as families and children would be missed out.The consequence of Sonia making her decisions on just the rock festival research could b e misleading as she has not acknowledge backn into consideration groups that may be her major customers. For example families may be her major target audience and if Sonia defines a decision based on a group other than the families she could release a non desirable flavour. If this does happen then it would mean that she could be releasing a flavour that is not in demand which would result in less sales and this less potential profits.It would also mean that her cost will rise through resultion and this would be wasted money as she may not be able to sell these intersection points. Secondly the response that Sonia may get from the people attending the rock festival may not be 100% accurate as they may not give the correct answers as they will compulsion to enjoy the event itself. For example Sonia may approach an attendee at the rock festival and ask them questions but they may not give eyeshot out answers as they are focalizationing on the music itself.If this does occur a nd Sonia does befool a decision on this information it could mean that she is making a growth which is based on incorrect data which could affect her sales which will make the released product less profitable. I ring that Sonia should not base her decisions solely based on the rock festival. I however do conjecture using a rule of primary research is a good start to making a decision but she could have thought out where the questionnaires would be conducted a little better. For example she could have done it in a soaring street where there is a chassis of people which would give her better feedback.For Sonia to base her decision solely on this it may result in her getting inaccurate results which would mean that the product released may not be as successful as it could be. I think that if Sonia motivations to make the product as establishive as it hatful be she should take do the primary research (questionnaire) in a more(prenominal) than than suitable place such as th e high up street. I also think that it should be use in conjunction with another(prenominal) shell of research such as the secondary research that she had collected before.By using both events of information it will give her more of an taking into custody as to what a customer wants and it would make her decision making march a lot more easy and accurate. 4) If Sonia decides to use a grocery store research mode to shadowvas the parvenue smoothie flavours, analyse two ways they might use a quota savour. Quota sampling is a sample take a crapd by gathering a predefined number of participants from from each one of several influence categories, for example choosing 25 people both from the categories anthropoid and female.There are some goods of using quota sampling one of which is that it clearly shows the demand from each of the categories. Sonia may want to decide to use a grocery research influence to investigate late smoothie flavours. I am going to analyse two reasons why they may use quota sampling whilst doing the research for Sonia. The first reason why the food market place research agency may use quota sampling is so that they posterior determine clearly what each group of people would like. For example once the research has been done using the groups male and female they crowd out determine what each group wants and tidy sum whole step at the rends. By having this geek of sampling it would give Sonia an idea of the wants of each group and she pile then make her decision based upon this. I think that this font of sampling would be very good for Sonia as the market she is entering is one which is different according to peoples personal perceptivenesss and by understanding what each category wants she can make a decision so that she can cater for exclusively of them. The second reason why quota sampling may be done is because it is a cheaper order as opposed to taster sampling.Taster sampling is when samples are presumptu ousness out to random customers to get their opinion on things, this agent that the be involved are very high as products are real given away. By doing quota sampling it means that the cost of actu wholey liberal out products is avoided, this would mean that the cost that Sonia has to pay the agency will be less meaning her be will perplex down. 5) Discuss methods of primary research the market research agency might use to investigate new smoothie flavours for Sonias smoothies.Primary research is one that is done and collected by yourself, primary research can be split into troika categories test marketing, surveys and observations, these can be then split even gain ground into the actual activities. There are some(prenominal) an(prenominal) an(prenominal) types of primary research that can be lightn and in this essay I am going to discuss some that the research agency may take up in order to investigate new smoothie flavours for Sonias smoothies. The first type of pri mary research that can be done is questionnaires these are types of surveys.This method is a very good way of getting back answers from the customers as it can be both qualitative information and quantative information. Questionnaires can be either done in person but can also be done through post. Questionnaires are the nigh common type and I think that for Sonia smoothies it would be a very good method as she can get a lot of feedback from potential customers. this information would give her a very good idea of what the customers will want and it would cooperate her make the correct decision.The correct decision will interne support her make profit as she knows she has the duty product for the right market. However whilst doing questionnaires they will have to make sure that they do not annoy the potential customers through a lot of ring calls etc as this could result in the business losing its re adjustation and potential sales. The second type of primary research that the m arket research agency may undertake is consumer panels. A consumer panel is a group meeting that is held whereby questions are asked and storied to give the results.The emolument of consumer panels is that the information is likely to be accurate as the people attending it will have a lot of measure to answer the questions meaning that they can tho approximately answer them. The disadvantage is that this type of research is that it may be more costly as the premise etc will have to be organised. This is a very good type of research as it allows qualitative information to be collected as well as opinions however I do not think that it is entirely suitable for Sonia smoothies as she does not necessarily need discussions to take place as all she wants is opinions of flavours and what customers want.Therefore I think that this method is not entirely suitable for Sonia smoothies. Another type of primary research that can be undertaken is taster sampling. This is when samples are given of the product and feedback is received by potential customers. This type of method is very good for a product that people will have different opinions on as it allows feedback from all types of people. Although there is a short term cost of actually producing these samples the broad term affect it could have is a positive one as it would mean that the right product is being sold to the customers and so change magnitude sales and profits.I think that this is a very suitable type of research that can be done by the market research agency as it would not only allow Sonia to get feedback for certain flavours it will also retrieveion shuffling awareness which would help her in the long run. Furthermore the market research agency may ask supermarkets about the surmount exchange smoothies in their stores. This is a method of primary research as it will be done by themselves. This is a middling cheap method of research as all it involves is contacting the supermarket with what t hey need.I think that this is a very good method of research for the market research agency to use as it will help Sonia identify which are the best interchange types of products and she could use this information whilst making hers. However Sonia wants to create a new smoothie flavour so copying other flavours may not necessarily be the best option. A way in which Sonia could avoid copying is to maybe mix the two top selling smoothies in the store for example mango and peach flavoured smoothie this would be different and unique. As a whole I think this method s fairly good in lot Sonia identify what flavours the customer tend to buy. As you can clear there are several(a) types or primary research methods that the market research agency can undertake for Sonia smoothies. I think Sonia should use a combination of these. Firstly she should use questionnaires to ask the potential customers what types of flavours that they would like. Once this is done she can begin to make the samp les for taster sampling which will then give her defacement reputation as well as the opinion of customers. By doing this it would hold that the research done is thorough helping her make her final decisions.As a whole I think to maximise effectiveness Sonia should use a combination of research methods to get a lot of peoples opinions. 6) Evaluate the immenseness of market research for Sonias smoothies LTD in making decisions over expansion. market research is a systematic, objective collection and analysis of data about a particular market. There are many ways to carry out market research. In this essay I will appreciate the importance of Sonias smoothies using market research and will give my opinion of how it should be carried out.Sonia smoothies has three man ways that she has identified so that the business can expand further, these are expanding geographically, by overtakeking to unfold through a wider range of outlets and lastly expanding the range of flavours that the y have. Firstly I am going to talk about the importance of using market research for the third work out of expanding its range of flavours. I think it is very important for Sonia smoothies to use market research as the smoothie market is one which is ever changing through new flavours and changing away factors such as health issues.By doing market research before releasing the product it would help the business understand the current market so that when they do release the new products they know that it is going to work in this market. By ensuring that the product being released is current it would help them amplification their sales and profits, intern this would also have a knock on effect on helping them to turn over their first sharpen of expanding geographically as they will now have the money to do so. Secondly having the arket research can not only be a method for the partnership to release new products but it can also increase brand awareness as doing things like taste r research will make people more aware of the company. If this happens then it could help them with their sales as people would be more aware and will be more confident in buying the product as they have already tasted it. By increasing the brand awareness it would mean that the sales will increase thus helping their profits. As you can see market research has more purpose for Sonia smoothies than just helping them to release new products.It is very important that Sonias smoothie takes out the necessary research so that they are successful in achieving their aims. Although market research brings a short term cost in the long run these costs will be covered by the success of the product depending on how well the research is done. Secondly is Sonia smoothies aim of distributing their products through a wider range of outlets than just health foods shops and events. There are many ways that market research will enable Sonia smoothies whilst making a decision as to what retailers to c onsume.Firstly market research can help them to choose the most effective shop. for example it can be used to see which shop has the least competition in it. By using market research to look at such things then it will help the success of the product as they will know that they do not have a lot of competition meaning that their product is more likely to be successful. This type of market research is vital as the market is always changing and the competition is always changing so for Sonia smoothies to have a competitive edge they will have to ensure that they have more sales.This is very important because if there are a lot of competitors it would reduce sales and intern come the amount of profits that are made. The second way that the market research may be used for this aim is to look at what retailers sell the most smoothies. By looking at this it will ensure that the smoothies that are made have the necessary demand. This is very important as it would ensure that sales can be made. Increased sales would mean bigger profits. however whilst doing this they will also have to look at the level of competition.As you can see market research is again very important in helping Sonia smoothies in their aim of expanding the number of retailers that they sell in. by increasing this it would help them increase brand awareness which will this increase the sales and profit. An increase in profit will help the business as it would mean that it will help them with their first aim of expanding geographically. furthestly Sonia smoothies has a aim of expanding the geographical area in which the smoothies are sold.This is linked to the second aim of selling through more retailers as that could help them do this. food market research again plays a vital role in making the decision as to where to expand. For example market research can be used to see where there are there is the spectacularst number of children for example (using children as Sonia smoothies main customers) by doing this it would give them a good perspective as to where there is a large number of their target audience. By having a lot of people that they can sell to it will increase their sales which will intern increase their profits. foodstuff research is very important in using this as the market is ever changing and there is no point of geographically expanding into an area where the sales are not likely to be high as it would be a waste of money. In conclusion the importance of market research is very high as it could help the business achieve all of their aims that they have set. All the aims are interlinked for example increasing the range of flavours and selling these flavours through more retailers would mean change magnitude sales, increased sales would result in higher(prenominal) profits which can then be used to fund for the geographical expansion.Because of this Sonia smoothies will have to ensure whilst doing the market research that it is done thoroughly, however they also have to keep an eye on the cost of the market research as they do not want to do it in such a depth where it costs them in any case much. If Sonia smoothies takes out the necessary market research then it could help them achieve all of their objectives of expansion, without market research the business cannot achieve their aims as effectively.Porters 5 ForcesPORTERS FIVE FORCES 4 Power of Suppliers Criteria aim operation on Power loading on proceeds Difference of Inputs mettlesome Increases descends Cost of chemise Suppliers gamey Increases Decreases holy terror of Forward integrating high school Increases Decreases Supplier Concentration amply Increases Decreases Difference of Inputs ? result differentiation in spite of appearance inputs in the technical schoolnical schoolnical school industry is largely dependent on how recently the input has been developed (the extent of which it is considered smashing edge). In cases where component innovations are the prop erty of the provider termss increase to compensate.However, in cases where products are low tech, some era(a) innovations, product differentiation is minimal. In some cases the differentiation between products may be so extreme that companies are forced to buy components from a direct competitor, just as apple purchased roughly $8 gazillion worth of parts from Samsung last year (Levine 2013). Since newer, more recent engine dwell is where the vast absolute majority of profits are in the tech sphere the level of difference of inputs is going to be considered high.This then increases the level of the negociate government agency of suppliers put hug on the companys profit margin. Cost of turn Suppliers ?Companies within the tech sector design their products close to certain components, impacting size, shape, weight and function. If a company is to change their component supplier then the product will have to be reengineered, costing the company time and resources that coul d be allocated elsewhere. These then threatens the companys ability to postulate, stay relevant and develop newer products in a market with a high product turnover rate.Thus companys have a high cost of geological fault suppliers, which in turn increases the negotiate power of suppliers which puts pressure on the buys margin and favourableness. little terror of Forward Integration ?Forward integration, the ability of a supplier to enter a put in of competition with their purchaser (Porters cardinal Forces 2012) is passing high in the tech sector. For instance, MSI and ASUS, two long time component suppliers have both entered a state of direct competition with companies such as HP and Dell, who they subdued supply components for (ASUS 2012).Because component suppliers often have a majority of all of needed parts to make the final product they can slowly enter the market, and while their products may not be on the cutting edge they are solid competitors. This threat of out front integration increases the dicker power of suppliers, which decreases the profitability of the buyer. Supplier Concentration ?Supplier concentration refers to the potentiality of market share the top suppliers in the industry have in relation to the total industry (Porter Model Suppliers 2010).Many of the larger tech companies have large market shares in their specific specialization, for instance Samsung has 97% of the world market share in OLEDs (Choi 2011), 40. 4% in drachma (Liu 2010), and 40. 4% in NAND flash (Samsung Expands 2012). ASUS currently controls 40% of the worlds motherboard market (ASUS 2012), while Intel controls 82. 3% of the global processor market (Shilov 2012). This extremely high supplier concentration results in a very large increase in supplier power, which drastically decreases buyer profitability. Summary The technology sector is preferably brutal on buyers when it comes to their relationship with suppliers, who have a disproportionate amount of bargain power with every category going in their favor. The difference in inputs, cost of geological fault suppliers, threat of forward integration and supplier concentration all favor an increase in supplier negociate power and a decrease in buyer profitability. With all these factors considered it comes as no surprise that many companies make and develop their own components or are previous suppliers who have undergone forward integration.Power of Buyers Criteria Level Effect on Power Effect on mesh Product speciality Low Low Decreases Number of Buyers/Sellers soaring High Increases work shift be Low High Limits Profitability Access to Information High High Degreases Access to Information ?The more information the buyers have, the better the bargaining power they are in. With all of the product information that can be accessed via the Internet, it gives the buyers added bargaining power. The Internet is a powerful tool for consumers.Buyers can comfortably use the Internet to compare prices, features, packages, and find great deals at the time of a purchase. There are many buyers who use the internet to access information and the effect on power is very strong which leads to having change magnitude profitability for the whole industry. Switching Costs ?Buyers who can shed brands at any given time due to a low teddy cost have more leverage than buyers who have high switching costs. The switching costs for this industry are low and have a high effect on bargaining leverage for the buyer. This leads to having limiting profitability for the industry.It limits the profitability because in principle, it puts a cap on how much scramrs can raise or reduce quality before they will lose the buyers business. However, in a few cases the switching costs can be high. When buyers purchase a phone, they can be purchased at a low price but with that it comes with a 2 or 3 year contract with a given provider. If this contract is breached, large fees are ordinaril y acquired by the customer. During this contract if a customer would like to purchase a new phone then they will have to pay unspoilt price for their purchase if their provider does not allow non-contract purchases.Product Differentiation ?In certain industries buyers will make their selection based on prices &8212 which would increase price completion among companies. When the products are differentiated then the buyers options will be limited. Unfortunately, in the industry Samsung is currently in the product differentiation is low. This has a strong impact on buyer bargaining power and results in lower profitability. When we take a look at Samsungs Galaxy Tablet compared with the ipad, we can see many similarities among the two products.The price is very similar, size, as well as features, and even the assault and battery life. Number of Buyers ?In this industry, there are many buyers that it can attract. Since Samsung makes products such as mobile phones, tablets, laptops, TVs , cameras, and much more they have many buyers since most of the items mentioned everyone has. The more buyers in a given industry results in more sellers the company will have to compete with and more alternatives a buyer can choose from. The larger the buyers as well as the number of sellers, means the customer is more important to the sellers business.Summary ?The overall buyer bargaining power for the industry that Samsung is in would be labeled as high. This creates a few challenges for Samsung as it makes the market very competitive, leaves little room for error, and creating a following for the company. With the buyers having most of the power the chances for profitability can be difficult to reach but Samsung has done a great blood reaching good profitability. They have handled the high effects of buyer bargaining power very well and have been gaining more buyer loyalty. curse of modestysCriteria Level Effect on Threat Effect on Profit Relative Price of Substitutes Low In creases Threat Decreases Profitability Relative mathematical operation of Substitutes High Increases Threat Decreases Profitability Switching Costs High Decrease Threat Increases Profitability Buyer Propensity to Substitute Low Decreases Threat Increases Profitability Relative Price of Substitutes ?When it comes to the price of substitutes in the electronics industry, it really depends on the particular product being considered, but overall, they are fairly low.For example, if somebody is looking to replace their laptop and is looking for a product that can satisfy their need to access the internet and communicate with others, they could consider purchase a tablet, which is fairly inexpensive compared to the price of some computers. (Spoonauer 2011) The low cost of substitutes increases the threat on businesses because they are at risk of losing customers to the businesses that are whirl lower priced substitutes. This loss of business would decrease their profitability. Relative Performance of Substitutes As with the price of substitutes, the performance of substitutes also depends on the particular products being considered, but overall the performance is fairly high. Technology has rapidly advanced passim the past few years, which has led companies to create devices that allow users to complete many tasks on one device, rather than have separate devices for each task. mortal that normally uses a laptop to access their email and chat with friends on social networking websites can now access those same things on a tablet, which is a much smaller and convenient device. Biggs 2011) The high performance of substitutes leads to increased threat, because customers are more likely to switch to a product that is high quality and extremely convenient. The increased threat would ultimately decrease the profitability, because it would be difficult for them to compete with a company that is offering a higher quality product. Switching Costs ?Depending on the individ ual customer, switching costs could be high or low. Switching costs tend to be high with electronics, because making the decision to purchase a new product commonly takes some time and research. Chen 2000) It is risky to purchase an electronic device without looking up product information and customer reviews beforehand. Switching costs can also be high because it takes time to get used to a new product and figure out all of the capabilities and features. This can be a time consuming as well as frustrating process. High switching costs leads to a decrease in overall threat, because many customers do not want to switch products if it involves a lot of time and effort. It is much easier to stick with a product that is familiar rather than try to learn something completely new.This will lead to an increase in profitability because customers wont want to switch to a new product offering from a different company. Buyer Propensity to Substitute ?Overall, buyer passion to substitute is f airly low, with a few exceptions. closely people are satisfied with the products they are using and are not looking to switch products all the time and look for the most recent technology. Many people who have laptops would never consider buying a tablet, because a laptop does everything a tablet does, minus the convenient size. moreover there are people who are always looking for the most echnologically advanced products and they are more than willing to substitute their products. Some people like the convenience of a tablet and would gladly replace their broad laptop with it. (Adhi Techno 2012) Because buyer propensity to substitute is fairly low, it decreases the threat of substitution, since most people dont have a need to switch out their current products. This ultimately increases profitability, because customers are remaining with that product rather than switching to a company that offers something else. Overall Threat of Substitution Overall, the threat of substitution h as roughly the same negative and positive impact on profitability. The low price and high performance of substitutes draws customers away from the business and encourages them to look to those substitutes to satisfy their needs, thus decreasing profitability. High switching costs and low buyer propensity to substitute have a positive impact on profitability, because customers would rather stick with their products rather than take the time and effort to find a new product to satisfy their needs. Threat of New Entrants Criteria Level Effect on Power Effect on Profit Product Differentiation High HighHigh vicissitude of Competition Moderate Moderate Low Start-up Costs High High High Distribution High High High Product Differentiation ? accord to Randy Khoo, author of wherefore apple is very(prenominal) Afraid of Samsung, Samsung carries itself through many different production areas even though most people believe Samsung only dabbles in the electronics market. At this time Samsung has 6. 5% of the IT Hardware market share, 7. 1% of the peripheral market share, 8. 5% of the converged devices market share and 5. 2% of the personal computer market share (Khoo, R). This means that the companys ability to spread over a broad span of products is immense.According to Khoo, Samsungs power could one sidereal day take over Apples entire market share. Diversity of Competition ?According to the U. S. Patent and Trademark Offices records from 2011, Samsung use for the second most patents in the Nation. In 2011 alone, they applied for and were granted 4,868 patents, right behind International Business Machines Corporation, who were granted 6,148 patents. Samsungs closest competitor, Panasonic Corporation, raked onwards with 2,533 patents granted (Patenting by Organizations, 2011). Start-up Costs ?As for all electronics, start-up costs are extremely high.According to Craig Kuhn, author of Barriers to Entry, the start up costs for firms selling electronics are extremely h igh due to the amount of technology and materials needed to create a marketable product. ?Another aspect new firms need to think about is their incoming reputation when attempting to compete with very popular firms. These brisk firms are knowledgeable about the industry and already maintain relationships with report manufactures and the biggest retailers. These new firms need to infiltrate these relationships in order to make way into the market, which isnt easy (Kuhn, C).Distribution ?Randy Khoo, author of Why Apple is Very Afraid of Samsung, states that Samsungs ability to sell their products anywhere is enormous. Since Apple purely sells their products in their stores, through their website and through their strict distribution channels, Samsung has the ability to take over the market by selling their products anywhere that will approve them. Samsung also has an existing distribution network from their existing businesses. This is of tremendous economic valueThese distributio n channels will also be there for the prox dissemination of other Samsung products.This means that if they want to, its easy for them to market more than just electronics (Khoo, R). Intensity of Rivalry Supposed to have quaternion criteria. Criteria Level Effect on Power Effect on Profit Product Differentiation High Decrease Power Increase Switching Cost High Decrease Power Increase Diversity of Competitors High Decrease Power Increase Cost Product differentiation ?According to Arthur Thompson, in his article, Crafting and Executing Strategy, the essence if a broad differentiation scheme is to be unique in way that are valuable to a wide range of customers (Thompson 2010).He also mentioned that, a focused strategy to focus keyed to differentiation aim at securing a competitive advantage with product offering carefully designed to appeal to the unique preference and needs of a narrow, well defined group of buyers (Thompson 2010). Broadly, Samsung faces many competitors who produc e a wide range of electrical appliances. They have competitors like LG, Panasonic, GE and so on. In a small niche, differentiation is still a major factor that influences the sales of certain products.For example, in the cellular telephone phone industry, there is a lot of differentiation constantly appearing in the cell phone competition, because differentiation can gain more advantage to their products. Therefore, the more differentiation their rivals make on their products, the less power Samsung has, and the more they will have to increase the cost of their phones. Switching cost ?The majority of Samsungs products are electrical appliances which require relatively high switching cost. According to Samsung, the common price of high tech products, like cell phone or tablet, is somewhat $500.The price of big electrical appliances is usually more than $1,000 (Samsung, 2012). Compared to other low switching cost products, the majority of Samsungs products have higher switching cost s. Also, the life cycle of those products are long, which means as long as customers buy the products, it is not easy for them to switch. Therefore, there will be more competition to attract customers. That would decrease Samsungs power, and they would drive up cost to make their products more attractive. Diversity of competitors ?There are many competitors in the electrical appliance industry.In the high tech industry, there are also many different competing companies. Apple is one of the main competitors in the high tech industry. According to Vaughan-Nichols, Apple has sued Samsung around the world. Apple has made the same lousy patent design claims Samsung has stolen the look and feel of its iPhone and iPad (Vaughan-Nichols 2012). The more competitors an industry has, the more the companies will spend to compete against rivals. Apple is only one of those competitors. As the industry becomes more mature, the variation of competitors becomes wider. Therefore, the effectiveness of Samsungs power in the industry will decrease.In addition, the more competitors the industry has, the more money each competitor will put into the production and marketing of goods in order to increase brand identity element and image. Therefore, the cost goes up. Overall Power of Rivalry ?Overall, the power of rivalry would have a negative effect on Samsung. The influence would be losing power in the market and driving up costs. The major influence from rivalries would be differentiation of products, high switching costs and diversity of competitors. RESOURCES Adhi Techno (2012) Top Five Reasons Tablets Will Substitute Laptops, Cellular Cell phones, and Pcs Accessed 15 February 2013. ttp//adhi-id. blogspot. com/2012/04/top-five- reasons-tablets-will. hypertext mark-up language. ASUS, ASUS. Last circumscribed 2012. Accessed February 18, 2013. http//www. asus. com/About_ASUS/ determinations_in_History_ASUS_Motherboards/. 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