Corporate Strategy & Competitive Analysis Lab

Porter's Five Forces Lab

Analyze industry attractiveness, competitive intensity, barriers to entry, buyer power, and profit pool moats using Porter's Five Forces in a free lab.

Forces Model Strategic Audit Five Forces Theory FAQ

Industry Presets

Load calibrated structural market profiles.

Step 1: Score Competitive Forces (1 = Low Threat / Friendly, 5 = Extreme Threat / Hostile)

Five Competitive Forces Scoring

Scale economies, capital requirements, switching costs, distribution access.
Buyer concentration, price sensitivity, backward integration threat.
Supplier concentration, uniqueness of inputs, forward integration threat.
Relative price-performance of substitutes, buyer propensity to substitute.
Industry growth rate, fixed cost burden, exit barriers, competitor diversity.
Industry Attractiveness Score
75 / 100
Premium Profit Pool (>20% EBIT)
Average Force Intensity
2.0 / 5.0
Scale 1.0 (Weak) to 5.0 (Hostile)
Dominant Bottleneck Force
Competitive Rivalry
Threat Level: 3 / 5.0 (Primary Profit Drag)
Strategic Environment Verdict
Highly Attractive / Strong Moat
Favorable Long-Term Return on Capital

Five Forces Diagnostic & Strategic Counter-Moves

Competitive Force Intensity Score Structural Assessment Recommended Counter-Strategy

Competitive Strategy & Industrial Organization

Mastering Porter's Five Forces

Developed by Michael Porter in 1979, the Five Forces framework explains why some industries consistently generate high return on invested capital (ROIC) while others struggle to earn their cost of capital.

  • Structure Shapes Profit: Industry structure—not whether an industry is high-tech or low-tech—determines long-term profitability.
  • The Strongest Force Governs: Industry profit is capped by the bottleneck force. For example, commercial airlines suffer from high supplier power (aircraft/engines) and fierce rivalry despite huge passenger demand.
  • Bargaining Leverage: When customers or suppliers possess concentrated power, they capture economic rents by demanding lower prices or higher input costs.
  • Strategic Positioning: Companies use Five Forces to find defensible niches, build moats, and reshape industry boundaries in their favor.

Map portfolio investments in the BCG Growth-Share Matrix Lab.

Strategy Scoring Formulas

Essential competitive formulas

Force Score (F_i) = Integer rating from 1 (Low Threat) to 5 (High Threat)

Average Intensity (I) = (F_entrants + F_buyers + F_suppliers + F_substitutes + F_rivalry) ÷ 5

Industry Attractiveness = [ (5.0 - I) ÷ 4.0 ] × 100

High Attractiveness (Score >= 70): Strong Economic Moat & High ROIC

Moderate Attractiveness (50 <= Score < 70): Balanced Profit Pool

Hostile / Hyper-Competitive (Score < 50): Structural Margin Compression

Evaluate market size in the TAM SAM SOM Lab.

FAQ

Porter's Five Forces and industry strategy questions

What are Porter's Five Forces?

Porter's Five Forces is a strategic management framework created by Harvard Business School professor Michael Porter that analyzes five structural market forces shaping industry profitability: Threat of New Entrants, Buyer Power, Supplier Power, Threat of Substitutes, and Competitive Rivalry.

How is the Industry Attractiveness Score calculated?

Each of the five forces is scored from 1 (Very Low Threat / Favorable) to 5 (Very High Threat / Severe Drag). The Industry Attractiveness Score (0-100) is calculated as: ((5.0 - Average Force Score) ÷ 4.0) × 100.

What makes an industry structurally attractive?

An attractive industry features high entry barriers, fragmented buyers with low bargaining power, plentiful commoditized suppliers, high switching costs against substitutes, and moderate, differentiated competitive rivalry.

What is the dominant bottleneck force?

The dominant force is the single highest-scoring competitive threat that exercises the greatest drag on industry economic returns and return on invested capital (ROIC).

Can I export Five Forces strategy audits to CSV?

Yes. You can export complete force scores, industry attractiveness indices, competitive diagnoses, and strategic counter-moves as a UTF-8 CSV spreadsheet with formula injection defense.

Is this tool certified strategic consulting advice?

No. This tool provides educational business strategy simulations for competitive analysis without certified corporate consulting warranties.

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