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Porter's five forces analysis

Framework to analyse level of competition within an industry

Porter's Five Forces Framework is a method of analysing the competitive environment of a business. It is rooted in industrial organization economics and identifies five forces that determine the competitive intensity and, consequently, the attractiveness or unattractiveness of an industry with respect to its profitability. An "unattractive" industry is one in which these forces collectively limit the potential for above-normal profits. The most unattractive industry structure would approach that of pure competition, in which available profits for all firms are reduced to normal profit levels. The five-forces perspective is associated with its originator, Michael E. Porter of Harvard Business School. This framework was first published in Harvard Business Review in 1979.

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