Exam 2: External Analysis: the Identification of Opportunities and Threats

Rapid growth in demand enables companies to expand their revenues and profits without taking market share away from competitors.

Opportunities arise when a company can take advantage of conditions in its industry environment to formulate and implement strategies that enable it to become more profitable.

Define a strategic group. What are some examples of how strategic groups differ in the way they bring their products to market? What are the implications for identifying threats and opportunities?

Strong brand loyalty and high customer switching costs are low barriers to entering an industry.

Which of the following is currently an embryonic industry?

Dale Smith opened his forklift dealership twenty years ago. Over the last five years he has been approached by several larger operations looking to buy him out. He had hoped to pass the business onto his sons, but they aren't interested in continuing the business and he is having a hard time letting go. This is an example of the exit barrier known as emotional attachment.

In growth industries:

An impact that the changing industry boundaries have had is that:

First-time demand expands rapidly due to new customers entering the market in which of the following stages of the industry life cycle?

Changes in the characteristics of a population, such as age or race, are irrelevant to the analysis of an industry's macroenvironment.

Successful innovation cannot transform the nature of industry competition.

As an industry enters the shakeout stage:

Which of the following statements about complementors is true?

Which of the following is NOT an implication that strategic groups must address when considering threats and opportunities?

Dave grew up in a household that primarily drank Minute Maid orange juice and lemonade. Now married with his own children, he continues to purchase Minute Maid products for his own family. This is an example of switching costs.

Suppliers in an industry are most powerful when:

Which of the following is NOT considered a benefit of industry analysis?

Which of the following would not diminish the risk of entry of potential competitors for an established company within an industry?

The extent of rivalry among established companies is lowest when:

Starbucks and an independent local café are different in terms of their business techniques. They both sell coffee and, therefore, belong to the same strategic group.