Industry threats
Industry threats are related to an increase in the competition in our industry or a reduction in market size. Generally industry threats threaten to reduce your businesses profitability.
Some possible Industry Threats include :-
- Low cost imports, the threat of low cost imports affects almost any manufacturer in the developed world, with the possible exception of food manufacturing.
- Consumer ability to shift to a substitute product and changing demand for substitute products, consider the manufacture of nails used in the assembly of house frames, if housing developers shifted from timber frames to steel framed houses, demand for nails would drop significantly.
- Slow market growth or decline in market size, western countries the demand for alcoholic drinks remains pretty flat.
- Shifts in customer or supplier buying power reducing your margins, consolidation in the retail industry has shifted buying power to the retailer who can place suppliers for generic products under high price pressure.
- The changing needs of buyers, (customers), take the McDonalds fast food chain as an example, Faced the threat of Australian customer needs changing towards a healthier life style. In response to this threat McDonalds has introduced several healthy eating options.
Ok, that's all from me for today!
BYE2!!
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