Presentation of the company P.3
What underlying forces in the macro-environment
drive the competitive forces?P.4
importance of: P.5
Using Porter’s analysis structure, identify the relative
Competitive rivalry P.5 The threats of substitutes P.6 The bargaining power of the buyers P.7 Thebargaining power of the suppliers P.8 The threats of new entrants P.9
Presentation of the company
An industrial and transportation company Decision to reinvent itself
Travel and tourism multinational The world's largest tourist firms with interests
The macro-environment forces that drive the competitive forces
Downturn in the tourism marketin 2003, easy entry into the market.
Globalization and tourism seemed to be a trend to shape the future. Political Easy to cross borders. Terror?
4.1%Market growth 1995-2005 in the tourism industry. Risk: Global economic downturn. Holidays trend growth (Globalization) Several terror attacks and health crisis Internet and information systems.Environmental
Natural disasters and global warming.
Legal framework are different (depends of the country)
Porter’s analysis structure
10 companies share more than 80% of the marketBetween 2005 and 2007 the growth rate has been growing slowly High fixed costs Exit barriers are high / a tough competition Low differentiation between tour operators
29% 21% 13% 21% 8% 8% Smallercompanies Others TUI Thomas Cook
The threats of substitutes
Using an other tour operator Doing it by yourself
The bargaining power ofthe buyers
Buyers’ concentration Costs of switching Vertical integration Weak ( - ) None Existing (+ )
The bargaining power of the suppliers