Target

2- Competitive environment:

Porter’s 5 forces: the retailer industry have some weakness and strength. They are many of retailer stores in the country. These retailers are big and compete with each other for short term and long term products.

First, Threat of substitution (HIGH)

The threat is high since all the competitors of retailers in the industry, the demand of customers is elastic, some of them will look for as low price as possible for some products. Thus, if Target raise their prices people will easily find other retailers stores to shop from.

Second, Power of Buyers (HIGH)

Since the competition is high buyers seek to get products in low prices as they will to pay, so they kind of have control of the prices for the store. Thus, the Power of Buyers is high, and it is sort of connected to threat of substitution.

Third, the Power of Suppliers (HIGH)

As a retailer company the can give up some products and not have them in stock. Also suppliers rely on these retailers since they buy huge amount of their product, they will be losing the retailer firms if they raise their prices more.

Fourth, Threat of New Entry, (LOW)

The barriers for entrance is high which makes it hard for a new firm to enter the industry. Also the current retailer firm have been in the industry for a long time which makes some power over the market.

Fifth, Competitive Rivalry, (HIGH)

As there are a lot of retailer firms who provide the same products, the competition is hard and firms will try to do their best to attract the customers. According to finance. Yahoo, Walmart is the leader firm in the industry with highest Net Income. Thus, it is really hard competing Walmart and other firms too, they need more strategies and work.