Porter's five-force analysis model was put forward by Michael Porter in the early 1980s. He believes that every industry has five forces that determine the scale and degree of competition, namely, direct competitors, customers, suppliers, potential new companies and alternative products. These five forces have jointly influenced the attractiveness of industries and the competitive strategic decisions of existing enterprises.
Porter's five-force analysis model belongs to the micro-analysis of external environment, which is used to analyze the overall strategy of competition and determine the competitive advantage of enterprises in the industry and the possible return on capital of the industry. Through Porter's five forces analysis model, entrepreneurs can predict their investment expectations and find the strategic development direction of enterprises.
Taking the newly opened private restaurant downstairs in our community as an example, this paper makes an analysis of the five-force model, hoping to deepen the understanding of the five-force model.
First, direct competitors.
Our community is in a motor city, surrounded by a real home, a commercial site invested by another company, and an antique site, so restaurants can be seen almost everywhere. Chain fast food restaurants such as Laoxiang Chicken, from all kinds of restaurants to all kinds of special food stalls, and hundreds of restaurants around them are direct competitors of this private restaurant. Every store is attracting the attention of residents, employees and bosses.
Therefore, private restaurants are already in an "over-competitive" market. How does this private restaurant survive in such a fierce competitive environment? Three strategies can be considered:
1. Provide high-quality and fast Chinese food and special private rooms. At noon, everyone's dining needs are fast and hygienic; The need for dinner in the evening is to enjoy delicious food and get together with colleagues and friends.
2. Establish a membership mechanism and use community marketing to grab coupons at a fixed time every day to increase user stickiness. As long as customers are willing to go in and spend money, they think the dishes in private restaurants are clean, hygienic and delicious, and they will come again next time if there is demand.
3. Study the withdrawal cost, rent, decoration fee, deposit and so on. , ready to quit and re-select the market.
Second, customers.
Customer is the greatest competitiveness, mainly reflected in the negotiation ability. The catering market is complex. In order to retain customers, many restaurants do not hesitate to make profits to retain customers. This method is effective in the short term, but it will only harm the interests of restaurants in the long run. How to break it?
1. Cooperate with large enterprises nearby to make cooperation on staff meals. With the most basic sales, the pressure of survival will be reduced. But in this way, the bargaining power of private restaurants is not as good as that of buyers. Therefore, while ensuring the basic sales volume, we must also ensure a fixed profit and not reduce the taste and quality of the dishes.
2. Establishing a business alliance with several high-quality and delicious businesses nearby and launching an alliance stored-value card together will increase the cost of customer relocation.
Third, suppliers.
The dishes in private restaurants are all purchased from big suppliers who serve hundreds of customers at the same time, so private restaurants have no bargaining power, so they can't get the preferential policies that big restaurants can get. Instead of being a small customer of a big company, it is better to be a customer of a small company and get a more reasonable price.
The landlord of the private restaurant is also one of the suppliers. Private restaurant business is flat, and the landlord also collects rent. But if the private restaurant business is booming, do you think the landlord will try to raise the rent? In order to avoid this situation, when renting a storefront, sign an agreement with the landlord to avoid disorderly price increases.
Fourth, potential competitors.
Everyone wants to enter the catering business while outsiders are watching, but it is not easy to really start a business. There is not only competition between different catering categories, but also pressure from suppliers and buyers. The pressure from potential new competitors is even greater. How to deal with potential competitors?
The first is to enhance the differentiated value of their own products, such as the taste of dishes, the cleanliness and hygiene of restaurants, and the diversification of publicity methods. Unique marketing method, hit the nail on the head, show your differentiated value with words or pictures, design a sentence to explain the reasons for consumption, such as grandma's private kitchen, and take you to experience the taste of childhood.
Publicity platforms can also be diversified. Where your customers are, you will be there. Physical elevator advertisements, bulletin boards in surrounding communities, take-away contact information, coupons, etc. Online WeChat community, friends circle, major short video platforms and take-away platforms all do some corresponding publicity, so that users can often see you and remember you.
Improve the entry threshold of new competitors, let them retreat after difficulties, organize activities with existing restaurants, make latecomers unprofitable, speed up the distribution of stored-value cards and coupons, and lock in the customer value in the next year or two.
Verb (abbreviation for verb) substitution
Instead of going to the private restaurant, what do consumers nearby eat? The most common thing is to order takeout. In our community, there is a vegetable market that has not yet been established. There are a lot of take-away companies here. Their rent is very low, and they are all run by their own families. These take-away companies have robbed many customers of physical restaurants.
Affected by the epidemic, everyone's income is not high. Many people are cutting back on expenses, bringing lunch at home and buying lunch boxes at the company to plug in. Self-heating lunch boxes on the market are substitutes for private restaurants. Therefore, private restaurants should be clear about themselves, take a quantitative approach to lunch, so the price is moderate, the quality is good, and more coupons are sent to attract customers to eat with colleagues at night and spend more.
Professionals pay attention to body management, can also provide diet meals, nutritious meals, or cooperate with take-away platforms to provide take-away services.
The analysis method of five-force model is systematic. Even ordinary private restaurants can find many effective competitive strategies and advantages through the analysis of the five-force model.
In the business world, any company will be influenced by these five forces at the same time. In addition to obvious competitors, there are upstream suppliers, downstream consumers, obvious new companies and imperceptible substitute products. A careful analysis of these forces through the five-force model will help entrepreneurs to formulate corresponding strategic plans and gain effective market position.
I also expect people who read this article to use the five-force model to analyze your industry and find out the development opportunities of your industry.