A 'five forces' analysis will suggest that profitability should be high when:
A)all five forces are high
B)all five forces are low
C)the two 'powers' cancel out the two 'threats'
D)industry rivalry is intense

Question

Quizplus · Accepted Answer

When all five forces (threat of new entrants, threat of substitutes, bargaining power of buyers, bargaining power of suppliers, and industry rivalry) are low, it suggests a less competitive environment, which typically leads to higher profitability for companies within the industry.

A 'Five Forces' Analysis Will Suggest That Profitability Should Be