With the Five Forces Model, companies should watch the forces in the market. If the forces are strong, competition generally increases, and if the forces are weak, competition typically decreases.

Question

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The Five Forces Model, developed by Michael Porter, suggests that five key forces determine the competitive intensity and attractiveness of a market. Stronger forces mean higher competition, while weaker forces suggest less competition. These forces include the threat of new entrants, the threat of substitute products or services, the bargaining power of customers, the bargaining power of suppliers, and the intensity of competitive rivalry.

With the Five Forces Model, Companies Should Watch the Forces