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Cell Phone - Industry Analysis

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Complete an Industry analysis. Describe and analyze the following:
a. Barriers of Entry
b. Barriers of Exit
c. Customer Buyer Power
d. Supplier Selling Power
e. Product Substitutes
f. Competitive Rivalry

Do not ramble, or re-define the concepts, apply them and be precise. Make your points in approximately 6 paragraphs; each paragraph should have about 3-4 sentences at the most.

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a. Barriers of Entry

In the cell phone industry, the threat of new entrants is low. The startup cost for wireless carriers are extremely high. Economies of scale are hard to achieve in the industry due to the amount of money that would need to be invested. It is difficult to enter the market with existing firms already operating on cost and differentiation strategies. The wireless communication industry is highly concentrated. Almost, 75% of the market is controlled by AT&T, Verizon, and Sprint which makes it difficult for the new entrants to come and compete in the market.

b. Barriers of Exit

The cell phone industry also has many exit barriers. A company would need to invest quite a bit of money in the beginning to increase market share, entice new customers, and have a good product line. Typically it takes a long time to recoup this investment. If a cell phone company were to terminate too soon, they would never reach the break-even point. In addition, it might be very difficult to sell organization depending on how successful the company becomes. Yes, we hear of mergers and acquisitions in the cell phone industry, but not to the extent that it happens in other industries. Since cell phone companies rely on a 40% or higher customer attrition rate (very high compared to most other industries) a company that ...

Solution Summary

This is an 847 word solution that outlines an industry analysis from start to finish it is 6 paragraphs in length. There are no references in the solution, because it describes known industry parameters.

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Cell Phone Industry Analysis

Through an e-mail, you inform the vice president of your company, Mr. Smith, that it is informative to obtain a good understanding of the industry environment when developing a strategic plan. You also explain to Mr. Smith that you will be submitting a report for his review conducting an analysis of the cell phone industry. You inform him that the analysis is a critical component of the business plan, and eventually, the topic will arise when presenting the final conclusion to the board of directors.

For this assignment, you must submit a report consisting of 850-1,000 words in which you discuss and assess the cell phone industry in terms of each of Porter's five (5) forces of competition. In the report, you must also assess the industry's overall attractiveness and identify several of the key success factors.

For full credit, you must address the following in your report:

Analyze the cell phone industry.
Discuss and assess the cell phone industry in terms of each of Porter's five (5) forces of competition.
Assess the industry's overall attractiveness.
Give examples of other cell phone companies, and address how they have done in the global marketplace.
Identify five (5) key success factors for a cell phone company.
Address the long-term goals for your company's cell phone.
Discuss the competitive environment of the cell phone industry.
Identify the overall objective of the cell phone (be creative and address what type of cell phone your company is trying to design).

Note: Use the library, Internet, textbooks, and/or any other materials to construct your report. Also, make sure to reference all sources using APA style formatting.

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