Which option describes what a five forces model shows?

Question

Options

• Aindustry players: suppliers, complementers, customers, and competitors
• Ba list of industry trends and drivers for total market growth
• Cthe top three competitive advantages owned by each of the major suppliers
• Dan analysis of customer priorities for technology purchase decisions

• A
  86% (25)
• B
  3% (1)
• C
  7% (2)
• D
  3% (1)

Explanation

Porter's Five Forces model is a strategic framework that maps the competitive structure of an industry by identifying the key players and forces that shape profitability - specifically: suppliers (bargaining power), buyers/customers (bargaining power), new entrants (threat), substitutes (threat), and existing competitors (rivalry). Option A is correct because it captures the core stakeholder categories the model analyzes, even if "complementers" is sometimes debated as a sixth force extension.

Why the distractors are wrong:

• B describes a PESTEL or trend analysis, not a structural competitive model.
• C is fabricated - the Five Forces does not rank suppliers' competitive advantages.
• D describes a customer needs/priorities analysis (like a voice-of-customer study), not industry structure.

Memory tip: Think "5 Forces = 5 Fighters" - the model asks who can fight you in a market: suppliers squeezing costs, customers pushing prices down, new entrants stealing share, substitutes replacing you, and rivals competing head-on.

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