Porter's Five Forces Luxottica Case
a) On what skills you need to leverage in this sector? Specifically Luxottica?
b) What is the best business model to gain a competitive advantage in eyewear sector? What is the “Vertical Integration” business model?
c) What is the economic model that explains the business risks and opportunities? d) How can you explain the success of Luxottica? What are the strengths?
1.1 Answers
a) It is very important to have the core competencies that make you gain market share. In this sector, there are several important elements: quality in products, new technologies, innovative strength and years of experience. In fact, Luxottica produces and distributes sun and prescription eyewear of high technical and stylistic quality. Every collection, every pair of glasses, is …show more content…
The model of five competitive forces of Porter describes the competitive system in which the company operates. The competitive structure of a sector therefore depends on the simultaneous interaction of the 5 competitive forces that are:
1. Intensity of competition between firms in the same sector;
2. Bargaining power of suppliers
3. Bargaining power of buyers (customers)
4. Threats caused by the entry of new market competitors (potential entrants)
5. Arising from marketing Threats products / replacement services
The five forces can be risks or opportunities, in fact a large company, such as Luxottica, successfully exploits these forces in their favour, using its bargaining power.
d) The Company's success can be explained by various factors:
• Product quality
• Quality in production
• Quality control
• Knowledge
• Good strategies
• Exploitation of opportunities
Luxottica has always focused on quality of products and production processes. Luxottica has used business strategies such as vertical integration and acquisitions, through which it is able to exploit opportunities on the market. Thanks to this, Luxottica, has created very strong brand, the first in the
b) What is the best business model to gain a competitive advantage in eyewear sector? What is the “Vertical Integration” business model?
c) What is the economic model that explains the business risks and opportunities? d) How can you explain the success of Luxottica? What are the strengths?
1.1 Answers
a) It is very important to have the core competencies that make you gain market share. In this sector, there are several important elements: quality in products, new technologies, innovative strength and years of experience. In fact, Luxottica produces and distributes sun and prescription eyewear of high technical and stylistic quality. Every collection, every pair of glasses, is …show more content…
The model of five competitive forces of Porter describes the competitive system in which the company operates. The competitive structure of a sector therefore depends on the simultaneous interaction of the 5 competitive forces that are:
1. Intensity of competition between firms in the same sector;
2. Bargaining power of suppliers
3. Bargaining power of buyers (customers)
4. Threats caused by the entry of new market competitors (potential entrants)
5. Arising from marketing Threats products / replacement services
The five forces can be risks or opportunities, in fact a large company, such as Luxottica, successfully exploits these forces in their favour, using its bargaining power.
d) The Company's success can be explained by various factors:
• Product quality
• Quality in production
• Quality control
• Knowledge
• Good strategies
• Exploitation of opportunities
Luxottica has always focused on quality of products and production processes. Luxottica has used business strategies such as vertical integration and acquisitions, through which it is able to exploit opportunities on the market. Thanks to this, Luxottica, has created very strong brand, the first in the