Answer the following questions using information from the case to support your answers:
• What, if any, issues or factors is the firm facing in the broad environment?
• What is the product or service? What function does it serve? What are the channels of distribution?
• What is the industry size in units and dollars? How fast is it growing? Are products differentiated? Are there high exit barriers? Are there high
fixed costs? These are some of the forces that determine the strength of competition among existing competitors.
• Who are the major competitors? What are their market shares? In other words, is the industry consolidated or fragmented?
• What are the basic strategies of competitors? How successful are they? Are competitors likely to retaliate to competitive moves or countermoves? How
rapidly do they respond?
• Who are the major customers of the industry? Are they powerful? What gives them power?
• Who are the major suppliers to the industry? Are they powerful? What gives them power?
• Do significant entry barriers exist? What are they? Are they effective in protecting existing competitors, thus enhancing profits?
• Are there any close substitutes for industry products and services? Do they provide pressure on prices charged in this industry?
Sample Solution