Porter's Five Forces - Threat of Rivalry

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Force five: The threat of competitive rivalry. Rivalry is the most obvious of the five forces in an industry; it helps determine the extent to which the value created by an industry will be dissipated through head-to-head competition in the market. Rivalry is most likely to be high in those industries where there are threats of substitute products and existing power of suppliers and buyers in the market. The fast food industry on the island is highly competitive with four (4) major chains KFC, Cheffette, Chicken Barn and Burger King; there are also island wide community outlets that not only do fast food but dry goods and alcoholic beverages. These restaurants constantly bombard the buying public with daily sales promotions. KFC runs a daily Value Meal with offerings in the price range of $12.99, and this is complemented with the What A Deal Meal program being done on a monthly base. Cheffette, similarly have its Value Menu for $9.99 and the monthly $13.95 Specials, and provide services for birthday parties, and play parks for children. Chicken Barn and Burger King have meal combos that include drink at reduced price. The community outlets would cater to the pockets by offering fast food for 5,7,10 and 15 dollars, in addition, specials on Beer and other alcoholic beverages is wide spread and common placed. The Major chains have an aggressive add campaign, utilizing mass media and social media. With such a competitive market restaurateurs would have to minimize fixed cost, have an attractive sales promotion program, develop value menus that cater to the spending power of the masses and use both mass and social media to engage the market with your

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