Porter's Five Forces Analysis Of Ikea
Porter’s 5 Force Analysis
Through Porter’s 5 force model, there can be established as several factors which are affected IKEA in China market. China, a factory of the world that produced low production and labour cost. The large labour resources with low cost have brought the multi suppliers to the foreign firms (Fenton, E, n.d.) which are included IKEA. Therefore, IKEA can request high qualified product at a low price where that is not limited to one supplier. The intensity of rivalry for IKEA China was high which it has ceased the contracts with certain suppliers, and these suppliers are becoming honest competitors with IKEA. Moreover, as the high profits and the broad prospects for the development of China furniture industry, most of the foreign investors are attracted to enter this industry and it has an increasing number of furniture enterprises and growth the market competition. Furniture industry China has developed rapidly and there is a huge space for industry development. In brief, there are abundant of the overseas furniture enterprises actively invest factories in China that to an implementation of “to sell real estate”. Obviously, seen from the China domestic furniture sales market, domestic brands and international brands of competition are fierce.
But now, the competitor of IKEA is mostly centralized in domestic brands which is the local competitor. For those local competitors or manufacturers, they are efficiently copying the idea and counterfeit the products
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