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Porter's Five Forces Analysis: Calm Coffee

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In this section, we use the Porter’s 5 forces model to evaluate the attraction of the industry when focus on the following 5 forces, Calm coffee faces the impact of the 5 forces, as outlined in Porter’s model. These five forces have different intensity or advantage based on Calm coffee position, as follows:

This part of the 5 Forces analysis shows that competition is one of the most important of Calm Coffee need to concern. The businesses have many competitors, which have different sizes, specialties and strategies. For example, Calm faces the competitive force of McDonald’s and Starbucks, as well as other specialty coffeehouse. The strong force of competition is also because of the low switching cost, which means that the customers can easy …show more content…

Calm coffee 's customers can easy change choose to substitutes because there are many substitutes in the market, such as soft drink or other special beverage from restaurants, and instant and bottled beverages and other goods from grocery stores. The cost of shifting to substitutes is lower because Calm coffee 's customers do not need to spend more cost for the shifting process. In addition, many of these substitutes cost less than Calm coffee products like soft drink or bottle drink. Thus, based on this part of the Five Forces analysis, Calm coffee must consider the threat of substitutes as the top-priority concerns.

The threat of new entrants of the 5 Forces analysis model shows that new entrants have obvious but not intense effect on Calm Coffee’s business. New entrants have ability against Calm Coffee because of the affordable costs of operation business and supply chain development. However, new entrants are difficult that to established brands completely like Calm Coffee because it is very expensive to develop a strong brand. So, this part of the 5 Forces analysis indicates that the threat of new entrants should put on a secondary priority in Calm Coffee’s

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