The document discusses the threat of new entrants, which refers to the threat that new competitors pose to current industry players. It is one of the forces that shapes industry competition. Barriers to entry like economies of scale, product differentiation, and capital requirements can discourage new entrants. The threat is high when barriers are low, such as when brand loyalty is low, investment needs are modest, and regulations are weak. The threat is low when barriers are high, for example when brands are strongly established and proprietary technology is required. In conclusion, analyzing the five forces helps firms understand their industry and develop effective strategies.

1. Presented To:
Mrs. Lutfun Nahar
Lecturer
Faculty of Business Administration
Presented By:
Name: Saimun Hossain
Id No: 1587
Batch : 42nd
Semester: 7th
University Of Science & Technology Chittagong (USTC)

2. Topic:Threat of New Entrants

3. What isThreat of New Entrants
The Threat of New Entrants, one of the forces in Porter’s Five
Forces industry analysis framework, refers to the threat that new
competitors pose to current players within an industry. It is one of
the forces that shape the competitive landscape of an industry
and that helps determine the attractiveness of an industry.
• A barrier to entry is a condition that creates a disincentive for
a new firm to enter an industry.
Can be two types
• Traditional
• Non-traditional

4. Framework
The other forces are competitive rivalry, bargaining power of buyers,
the threat of substitutes, and the bargaining power of suppliers.

5. Barriers to Entry
• Economies of Scale
• Product differentiation
• Capital requirements
• Cost advantages independent of size
• Access to distribution channels
• Government and legal barriers

6. Nontraditional Barriers to Entry
• Strength of management team
• First-mover advantage
• Passion of the management team and employees
• Unique Business Model
• Internet Domain Name
• Inventing a new approach to an industry

7. HighThreat of New Entrants When:
• Low brand loyalty in the current industry
• Current brand names are not well-known
• Low initial capital investment required
• Access to suppliers and distribution channels is easy to obtain
• Weak government regulations
• No threat of retaliation
• Proprietary technology is not required

8. LowThreat of New Entrants When:
• High brand loyalty in the current industry
• Brand names are well-known
• High initial capital investment required
• Little to no access to suppliers and distribution channels
• Strong government regulations
• Threat of retaliation from existing competitors
• Proprietary technology is required to be successful

9. Conclusion
In conclusion, Porter’s Five Forces have huge impact of an
industry because it can stack out position of a firm in an
industry and able to let the firm know their strength and
weakness in order to retaining customer. Therefore, the
companies should clarify the five industry forces to have
a better understanding in order to begin develop its
strategic use for business. At the end of the last, the
threat of new entrants has significant influence on
existing companies.