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Part of the 5 Forces

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Submitted By hollyk
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Rivalry Among Existing Competitors

In regards to Mikes Bikes we could Use price discounting, or introduce new bikes or increase our advertising to differentiate from competing bike firms. However if we use price discounting, this may to result in retaliation and Price competition could occur as rival companies bikes are nearly identical to our bikes and there is few switching costs for buyers. This is something to be aware of if we were to use this strategy.
However we could use non-price factors such as increasing brand awareness or product specification on our bikes as it less likely to eat away at profitability

Threat of substitute product or service
. Because substitutes can appear very different from the industry’s product they are always present but can be easily overlooked. For instance an example given in the article was that videoconferencing is a substitute for travel. This is true if the purpose of the travel was for a work meeting or conference, this communication could be done through videoconferencing therefore it can substitute travelling. To determine what a substitute for a product is, the industry the product is in needs to be defined.

In relation to Mikes Bikes to determine what substitutes there are for our products, we need to define what industry we are in. Because of the different products we offer, we may fit into several categories or industries. For instance with our road bikes, that could come under the transportation industry. Some substitutes for that then could be cars, motorbikes, public buses or electric scooters. It then would be important for us to monitor what is happening within that industry. For example car prices or petrol prices may increase which could positively impact us and allow us to substitute for cars. Secondly with our youth bikes that could come under the entertainment/recreation industry as that may be

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