Intensity of Rivalry (one of Porter’s Five Forces)

Intensity of Rivalry (one of Porter’s Five Forces)

The intensity of rivalry among rivals in a market describes the degree to which businesses within a market place stress on each other and restrict each other’s revenue potential. If rivalry is intense, then competitors want to take revenue and share of the market in one another. This reduces profit potential for all firms within the industry as a result. Based on Porter’s 5 forces framework, the strength of rivalry among businesses is among the primary forces that form the structure that is competitive of industry.

Porter’s intensity of rivalry in a market impacts the environment that is competitive influences the power of current companies to obtain profitability. As an example, high strength of rivalry means rivals are aggressively focusing on each other’s areas and aggressively pricing items. This represents costs that are potential all rivals in the industry.

Tall intensity of competitive rivalry will make a market more competitive and so decrease revenue possibility of the firms that are existing. In contrast, low strength of competitive rivalry makes a business less competitive. It increases profit possibility of the firms that are existing.

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