MIS Assignment 01
MIS Assignment 01
MIS Assignment 01
Problem Statement:
• Select any firm/organization and explain how they achieve competitive
advantage using Michael Porter’s competitive forces model.
• Justify your answer with examples.
Answer:
The firm is Pizza hut a multinational food chain which is doing business in Pakistan
market. We will use Michael Poters competitive force model that how the pizza hut can achieve
competitive advantage in Pakistan. Pizza hut is a multinational food chain which is operating in many
countries and mostly they are famous due their signature pan pizza and garlic bread. Competition in
an industry can depends on Five forces which are:
1. Competitors
2. Potential of new entrants
3. Power of Suppliers
4. Power of Customers
5. Threat of Substitutes
The Pizza Hut can achieve competitive advantage because they have brand name due to which
they are famous for and their taste. They have done marketing of their product in different
Hollywood movies due to which more pizza lovers or pizza consumer have interest in buying
their product. Now comparing it with the competitors the pizza hut has very fast delivery
service of their product to the customers and they are good in taste which other doesn’t offer.
Example: Customers buy pizza hut because of their premium taste.
There is Potential entry of new entrants because pizza business does not require lot of capital
to start its operation. It is cheap business for new entrants to open their outlets in their town or
city. Many new entrants selling homemade pizza to the customers with the help of foodpanda
sevice.
Example: Pizza seller now don’t need any delivery setup they can use food panda service to
deliver the pizza from home or from their outlet and it is very cost effective for new business.
The power of suppliers is very important for any business because without supplier business
cannot run its day to day operations. If company have good liquidity in terms of capital and
paying history to its creditors than suppliers will easily supply their goods because they know
they have good reputation in business and they will pay them on time. So pizza hut suppliers
will easily supply their products to them because of their strong liquidity.
Example: Pepsi who is supplier of pizza hut will not supply their beverages if pizza hut fail to
pay their liabilities.
The Threat of Substitutes is very important because if pizza hut fail to give customers good
taste, quality and better pricing than customers will not buy from them and will shift to the
substitutes who are offering low price and good quality.
Example: Substitutes like pizza max and homemade pizza seller sell in low price to their
customers
Power Of customer is the decision of the customer who decides whether to buy the product or
not. Pizza hut was firs brand who introduce itself to the customers by entering into the market
by selling its franchise in city due to which it became easy access for customers to get their
pizza with help of dinning, take way and delivery.
Example: Customers whenever order to buy pizza they first think of pizza hut due to
psychological effect of the brand in their mind.
Traditional competitors
Pizza Max
and services
,Childern kids,OldAgeAdultand youth
Customers
Pepsi,Admas Cheese, Knor ketchup
Suppliers