Porters Five Forces

Porter’s Five Forces

The purpose of this analysis is to recommend to management a potentially lucrative industry that our strategic team deems profitable for entry. In order to accomplish this, we adopted a unique approach. Largely eschewing contemporary means of identifying markets for entry—talking to people with MBAs, reading business journals, and in general following the trail of money to what is increasingly the omnipresent doorstep of Big Data—the five of us hit the road in a 1978 Volkswagen Bus with little more than a couple of travel hammocks, several Moleskine journals, dog-eared copies of everything from Steinbeck to de Toqueville to Dostoyevsky to Michael E. Porter, a Yeti cooler, a .22 long rifle, and open, enterprising minds. And also an expense account, for which we remain grateful.

        We followed a route that took us to places beyond the densely populated urban areas, through the Upper Midwest, then west to Missoula, before beginning a winding tour of the Rocky Mountains out of Boise that ultimately ended in Santa Fe. We were intent on discovering an opportunity for management to pursue that not only offered long-term profitability, but was also unconventional in that its focus offered a shift away from the viral vicissitudes and tech-obsessed tastes of the millennial market. Our team, sensing from its homebase in Austin an oversaturation of smart phone apps, yoga-inspired hashtags, and health beverages, traced a path through a landscape populated by people who still view the internet as a luxury in order to ultimately arrive at a highly-specialized market opportunity: flies tied of hardy, high-quality materials by American tyers.

The Commercial Fly Tying Industry

        “The essence of the [industrial organization] paradigm is that a firm’s performance in the marketplace depends critically on the characteristics of the industry environment in which it operates.” Moni underlined that when the Bus broke down outside of Bismarck and we held an impromptu Vision Meeting in the shade of an oil derrick near the side of the highway. We all agreed that it was a critical point to keep in mind as we scoured the Heartland for industries that exhibited mild states of economic competition. We knew that the more clearly we understood the competitive pressures of the industry we chose, the more effectively we could develop a strategic course of action.

        As we drove from town to town that July, drinking stale coffee in cafes with deer heads mounted above chrome-lined counters, frequenting locally-owned businesses to develop a notion as to what it was that the people who lived and were visiting these places were spending their money on, it was soon apparent that many of these towns survived largely on outdoor recreation tourism—fly fishing in the late spring, summer, and early autumn, and big game hunting in the late fall and winter months.