According to Porter, there are five forces that must be assessed and acknowledged by any business who wishes to successfully create an effective strategy. Which of the following best demonstrates the threat of substitutes for a handmade furniture manufacturer?
A) A furniture store that sells ready-to-build pieces from unique designs.
B) A handmade home décor store.
C) A supplier who sells mahogany wood and determines the terms that a potential buyer must meet to buy from them.
D) Another furniture store who also sells handmade furniture.

Question

Quizplus · Accepted Answer

This question requires familiarity with Porter's Five Forces and the impact of each on a business. Choice A is correct because it is the only choice that represents a threat of a substitute product. A furniture store that sells ready-to-build furniture may pull some of the business from a handmade furniture store. The other three choices are incorrect as they represent other threats to the furniture store.

According to Porter, There Are Five Forces That Must Be