Porter’s Five Forces

Michael Porter, legendary Harvard Business School professor, created a framework for understanding the dynamics of an industry based on five competitive forces. The category sourcing manager can use this model, called Porter’s Five Forces, to better understand the context of a relevant supply market for their category. The five forces are: Threat of New Entrants, Bargaining Power of Buyers, Bargaining Power of Suppliers and Threat of New Substitutes. These four forces combine to determine the 5th force, which is the Rivalry Among Existing Competitors.