Please enable JavaScript.
Coggle requires JavaScript to display documents.
Porters Five Forces: Split Nail Construction., Medium Buyer Power, Low…
-
Medium Buyer Power
Buyer has multiple options in the market place giving them the power to chose the contractor they prefer.
A homogenous product is not provided. Different contractors have different levels of capability. If the buyer wants a good product they have to higher the best skilled labor
Inexperienced buyers and owners find it difficult to navigate this type of market because the product can be difficult to understand (Dandrea, 2017).
In the end, the buyer makes the decisions about the end product and if their goals are not achieved they have the ability to fire the contractor.
-
-
Low Supplier Power
Due to the large number of suppliers such as Lowes, Home Depot, and a number of othre large contractor and lumber department stores supplier power is low.
-
Numerous brands for contractors to choose from based on the store allowing for substitutions of almost any of the products necessary to complete a job.
If contractors are unsatisfied with a certain supplier it is simple for them to move on to the next lumbar yard/ department store in order to acquirer needed products. Especially if suppliers cause delays because delays cost contractors a large amount of money (Petrov & Vara, 2008)
-
Medium Threat of Entry
Medium to Low start up Cost for a construction company. A construction company can be started with 10,000 to 15,000 dollars (LegalZoom.com)
It takes a couple of years of experience to learn everything necessary to run a construction company. The only way to gain experience is by working in the industry.
Few barriers to entry. it must be registered, have a bond, insurance, and contractors license in order to start work.
Must understand how to run a business and the amounts necessary to be charged in order to cover all of the taxes that must be paid for.
-
-