ABSTRACT
Michael Porter originally developed the Five Forces model as a way of evaluating the attractiveness of an industry. These are threat of new entrants, bargaining of suppliers, bargaining power of customers, threat of substitutes, and market rivalry. Porter described his analysis as being concerned with the ‘forces driving industry competition’. Assessing all facets of potential competition provides for a rounded view when deciding upon what action to take in order to gain a competitive advantage. Increased competition drives down the profit potential in a market. Organisations therefore need to understand how to develop opportunities in their environment and protect against competition and other threats. Five Forces model has been the subject of some critical comment, largely surrounding the static nature of the framework, whereas in practice the competitive environment is constantly changing. One of the greatest critics from the procurement field has been Professor Andrew Cox who has published strong criticism of the model.
