Michael Porter suggested that managers view the environments in which they operate in terms of five competitive forces. These are the threat of new entrants, competitive rivalry, the threat of substitute products, the power of buyers, and the power of suppliers.

Using your knowledge of the environmental forces, indicate which environmental force is represented by each example.

New Entrants

Competitors

Suppliers

Buyers

Substitutes

There are thousands of brands of craft beer.

The local electric company is the only source of electricity in the community.

In $2015$ and $2016,$ respectively, Amazon Handmade and Facebook Marketplace were launched as places where individuals could find buyers for one$-$of$-$a$-$kind items.

A Starbucks opened around the corner from the local coffee shop.

Walmart makes large purchases from suppliers to stock inventory for its customers.

Organizations can adapt to the forces in their environments. They have several methods available to them. The question presents several examples of the actions organizations took in response to forces in the environment.

For each action, indicate the environmental threat that action was intended to mitigate.

New Entrants

Competitors

Suppliers

Buyers

Substitutes

Financial services firm Morgan Stanley acquired E$*$Trade$.$

Recognizing the rapid growth in sales of milk substitutes like almond milk, dairy$-$milk processors developed a $$50$ million ad campaign to promote the protein benefits of cow milk.

Firms can sign long$-$term contracts to stabilize prices for orders over time.

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