Free Case Study About Porter’s Five Forces Of Competitive Position Analysis

Porter’s Five Forces analysis provides an effective tool for evaluating the competitive strength and position of the Airborne Inc.

The theory underpins competitive intensity and attractiveness of a market to five forces as follows:
Supplier Power
Suppliers are placed in a strong bargaining position due to the political issues and economic issues dictating fuel prices
Low bargaining power in the packaging equipment such as boxes and plastics
Service suppliers of aircrafts maintenance and catering and airport service suppliers have a high bargaining power increasing the shipping cost
Suppliers are investing in technology to reduce the bargaining power
Buyer Bargaining Power
Customers are highly flexible and have a high bargaining power on prices
Corporations find it cheap switching to other firms
Brand name images locks customers thereby lowering their bargaining position
Competitive Substitution
Document delivery services face competition from facsimiles and emails
Digitization and internet penetration offers substitute services to the document delivery services in the air express business
Banks are offering online checking accounts that offer customers an alternative way of verifying their statements
Threat of New Entry
The economies of scale in the global transport industry reduces the entry of new firms
Mergers, acquisition, and strategic partnerships are common among the companies to enhance their competiveness and reduce the threat of new entry

The need for large distribution network and technology reduces the threat of entry of new firms

Strong brand name among FedEx, UPS, and DHL reduces the threat of new entrants
Competitive Rivalry
There is a fierce competition in terms of price among FedEx, UPS, Airborne Inc.
UPS is the largest competitor with 53% market share in small package deliveries in the U.S
FedEx is the second dominant competitor in small package deliveries with a market share of 26% in the U.S
Airborne ranked third in small package delivery with 9%
Competitive rivalry forced DHL out of the U.S markets after acquiring Airborne Inc.