Competition Case

Chapter 7

Competition is vital in every business as there are more companies entering the market and all companies are striving very hard to achieve a good profit. Harley Davidson has a very narrow market amongst the people as the pattern of there bikes vary and are not suitable to all ages.

There are lots of competitor's strategy which are faced and harley davidson should improve in all things.We will discuss it along with the Porters 5 forces to find out the competitive strategy.

The threat of new entrance in harley davidson is low as there are lots of barriers in the entry mode like huge capital and manpower requirements. Proper economies of scale should be there so as to have profits. Therefore as the economy is booming Harley davidson should examine all ways by which they can enter new places and capture the market demand. More publicity and more awareness amongst people is preferred thing.

The power of suppliers is relatively low because suppliers of the motorcycle supply raw materials and components to the motorcycle industry where it is used.As suppliers are more, there is less bargaining power and since the production is done in quantities so raw material can be purchased in quantities. Harley Davidson can locate more suppliers and can try to purchase raw materials so that the company can earn more profits. Price sensitivity would even affect the customer as if the products are cheap then there will be more demand.As Harley Davidson is a luxury product there is more demand and monopoly across the globe.

Factors such as rising fuel prices and slow economic growth will have an two ways impact in industry in terms of substitutes. Regarding motorcycle as a form of transport , fuel prices had lead to increase demand for motorcycle. Therefore threat from cars will be low, and also switching cost from motorcycle to cars is relatively high, thus making threat as the switching cost will