Porter's Five Forces Model

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Porter’s Five Forces Model Competitive Rivalry or Competition- High Force The fast food industry in New Zealand has an intense competition involving international franchises like McDonald’s and local firms such as BurgerFuel which maintains to expand with additional outlets across New Zealand. This industry is genuinely competitive due to the high number of outlets, low switching and high aggressiveness between firms. Prominent chains, such as McDonalds, Burger King, and countless others have strengthened as they “fight to offer the cheapest meal deal ever” (Marino, 2016). Firms tend to use cost-based strategies such as proposing different promotional ideas to overwhelm their rivalries. For example, McDonald’s launched their $5 menu range Several leading companies often have the same suppliers due to the nature of the industry. This means that a major proportion of fast food chains use locally sourced ingredients, for example, KFC and McDonald 's source all their chicken from “two trusted Kiwi suppliers, Inghams and Tegel” (KFC, n.d.). These two suppliers are New Zealand’s leading chicken supplier’s across the country due to their brand reputation and geographical coverage since they provide top quality product and service. Wherein they have a strong relationship with many fast food franchises in New Zealand. The amount of suppliers in the fast-food industry creates difficulty for the contractor to influence power over the fast food companies. Therefore, bargaining power of suppliers has a low force but positive impact on the industry since having the same suppliers is decreasing costs for the firm and also customers. 167 words Porter’s Five Forces model, was recognized by Michael E. Porter, to “identifies and analyzes five competitive forces that shape every industry” (Investopedia,

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