COMMERCE 4PA3 Chapter Notes - Chapter 4-5: Hyperloop, Financial Market Participants, Brand Loyalty
11 Sep 2017
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Porters 5 forces: threat of new entrants - low risk: The airline industry has large capital requirements which makes it difficult for an average retail investor to enter into the industry. Also exiting costs can be huge losses creating a high risk industry for new entrants. The airline industry is a tightly regulated industry creating entry and exit barriers by the government. The airline industry tends to see often flyers as brand loyal consumers because of well marketed customer loyalty programs: threat of substitute products - low risk: Other ways of transportation include road, railways and by marine. For substitute products it really depends how much distance the customer is trying to cover. Substitutes have a great disadvantage compared to air travel in regards to speed of the transportation method. However businesses should be weary about recent technological changes and advances in hyperloop trains in the near future: the bargaining power of buyers - high risk:
