Porter's Five Forces Analysis Of Subway

2.2 Carry out an environmental audit for the organisation. Threat of new entrants

Most of the fast food industry in the market have a threat of new entrant because of the low setting up cost and no product differentiation. Subway itself has come up based on an alternative concept of health and nutritional food to that of the conventional fast food restaurants. There is always the threat of new entrants in the fast food restaurant segment. The foot products have a lot of differentiation, Subway is only concentrating on one particular area, and the threat of new entrants is high.

@Major threats of entrants are setting up of the entrance and differentiation of products which is important for market penetration and market development

Threat of

The convenience stores are also able to develop their own small-scale restaurants which are acting as substitutes.

@There are lots of convenient shops, mid range restaurants and health food shops are therein the market. So customers can have much kind of alternatives to select their option.SUBWAY marketing strategy should cover these every kind of competition as well. Precooked foods which customers can easily consume are the other threat. Different kind of other social activities regarding fast food industry also could be a threat f for SUBWAY market

Bargaining power of sellers

As Subway is concentrating on healthy and nutritional ingredients and fresh products, the source of suppliers are limited. Hence the power of suppliers is high for Subway

@We can consider as power of suppliers for SUBWAY market as farming industry, worldwide market of suppliers and alliances.

Bargaining power of buyers

Brand loyalty is getting diminished due to the entry of new outlets and alternative brands and the consumers are shifting towards alternative suppliers (Pride and Ferrell, 2010).

@Any kind of industry power of buyers is specially consumers. Some kind of little brand loyalty also can be considered as power of

Suppliers are the people who provide Subway with fresh and quality ingredients. Suppliers are allowed to raise their prices. Therefore, with the increment of prices it will then affect the company’s profit. Moreover, the relationship between the suppliers and the company is important as they must have a loyal relationship. It is important to have a loyal relationship because the ingredients they supply to the company can affect the company’s operation, without the supplier Subway can’t serve their customers with quality ingredients. Therefore, supplier’s cooperation with Subway enables them to develop goals to success and to avoid downgrade the company reputation. Supplier can also give long credit term to regular buyers where they don’t have to pay the bill immediately and they can also gives discounts to the