Porter's Five Forces Analysis: Harley Davidson

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Porter 's Five Forces Threat of New Entrants: LOW Like any automobile company, Harley Davidson industry also has large manufacturing facilities and equipments. New Entrants would have to have a large amount of capital and would need to spend tons of money in advertising and promotion to receive the same amount of brand recognition and customer loyalty that the powerhouses company Harley Davidson has already gained. And retailers, without the brand recognition and customer loyalty of the new entrants, would be afraid to carry such products. Threat of Substitutes: LOW Motorcycles don 't take much of one’s income; customers often switch to the substitutes if price increases and purchasing a cheaper substitute becomes their better choice. But, the facts that Harley-Davidson has a strong image of a lifestyle, the substitute products are no match to Harley-Davidson products. This will sway customers from buying substitutes because it is just not the same. Bargaining Power of Buyer: HIGH Satisfying customer 's needs are really important when it comes to Harley-Davidson. Despite having customer loyalty, pricing will always be somewhat of a factor. Other Japanese manufacturers, such as Honda and Suzuki, offer a cheaper price than Harley-Davidson. Harley-Davidson has differentiated their products from Japanese product lines but price will always be a factor when purchasing a motorcycle. Bargaining power of suppliers: Moderate/High Harley’s suppliers are not fragmented so they