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SMMCG4[BS-2] External Analysis, ［SMMC-ETC ］G4, 2-1Analyzing the Macro…

- - - - The coexist relationship of competitors and cooperators
        
        While competing with each other, also creating the value together at the same time.
        
        make money together and make loss together
        
        considering more comprehensive
- - - - The influence of each force on the profitability of the industry is different and cannot be compared.
      - It is only suitable for analyzing industries where the industrial structure has matured and has not changed much.
      - The degree of competition in the industry
      - can only predict the future profits of some industries with small changes and cannot directly derive individual companies
        to make a profit.
- - - - Internal analysis
      - external analysis
        
        Industry Macro-environment
        
        PESTEL Framework
- - - - state, local, national and even Union
    - - political stability, security and corruption
  - - - different legal regulations
  - - - urbanization
      - the growth of the middle class in many emerging markets
        
        Western lifestyles、values
    - - electric and hybrid cars
      - solar and battery infrastructure
      - driver-assistance
      - self-driving digital technologies
    - - as the same as other corporation
        
        covid19
    - - climate change
      - air pollution
      - waste cycling
    - - energy policies around the world
        
        future autombile
    - - international treaties for trade and investment
      - labor and environment pollution laws
      - product liability
- - - - Intensity of rivalry is high when
        
        high fixed or storage costs for the product or service
        
        slow demand growth and high overcapacity
        
        low industry concentration and product differentiation
        
        high exit barriers
        
        Good for R&D, AD, offer more value to customers
        
        Harmful if rivalry turned into total price competitions
  - - - The more concentrated the buyer's industry, the better they are able to bargain.
        
        Like Walmart's supplier
  - - - The more concentrated the supplier's industry, the better they are able to bargain.
        
        Like 7-11 around your home
  - - - Traits
        
        Better cost structure
        
        Airbnb V.S traditional hotel industry
        
        More innovative or value providing
        
        Uber is better than conventional taxi
        
        Meet similar needs
        
        Such as Cola and Pepsi
        
        Improving quickly in cost or performance
        
        Electronic car like Tesla
  - - - If entry into an industry is easy then anytime the industry has above average profitability.
        
        Setting entry barrier is the way out
        
        Supply Side
        
        Hard to replicate
        
        Strategic
        
        A company expected to respond to entry with aggressive pricing, advertising, new products, etc.
        
        the expected retaliation changes how attractive the industry might look to potential entrants which would discourage them for entering.
- - - - airlines
        
        price rivalry
        
        service is undifferential
        
        compete on price
        
        fill seats
        
        lowering prices
        
        low entry barriers
        
        no scale/scope economies
        
        airplane and crew are easily leased and hired
        
        new entrants can get access to airline ticketing systems
        
        demand
    - - pharmaceuticals
        
        high entry barriers
        
        R&D
        
        capabilities of marketing
        
        regulatory clearances
        
        products are highly differentiated
        
        low buyer's bargaining power
        
        buyers rely on the products heavily for health
        
        buyers wouldn’t bargain the price of drugs
        
        health insurance
        
        substitutes
        
        generic drugs
        
        work as effectively as patent drugs
        
        suppliers can just exert little bargaining power
- - - - EX：PESTEL
- - - - Why?
        
        Imagining Dames.
        
        keeping the water and profits in place are the barriers to these forces.
        
        If any one of the dams is weak and broke down, water from the lake would drain away through that bridge. =profits in an industry are susceptible to the weakest of the five forces.
        
        Gravity acts on the water = Forces of competition
        
        Water in the lake
        = industry profits.
      - As you are manager：Monitoring key power and make it be competitive.
        
        For example：Airline
        
        Competition to co-opetition
        
        Increasing industry concentration.
        
        Earning more money
        
        Strategically intervene to reshape force and improve industry profitability.
- - - - Co-opetition