5 Forces



Using Porter’s Five Forces as an analytical tool, the strengths, weaknesses, opportunities and threats of Remcor are integrated together to look into a strategy that best fits the needs of the company. Five factors were determined from the SWOT analysis above, each were ranked from 5, 3, and 1; 5 – showing strong market forces, 3 – showing medium market forces, and 1 – showing weak market forces.

1.)   Threat of New Entrants – Ranking 5 The market force is strong in this factor because no patents are required in the automotive manufacturing industry. Furthermore, there is an increasing investment of automotive manufacturers particularly in China, India, Russia, and Brazil.

2.)    Supplier Power – Ranking 5 The market force is strong in this factor as well because multinational companies are prioritized despite the number of suppliers globally.

3.)    Rivalry of Competitors – Ranking 5 The market force is also strong in this factor due to the fact that there are many manufacturers of auto parts who are equally competitive.

4.)    Buyer Power – Ranking 5 Buying power is a strong market force because the bargaining leverage of a company lies in the number of supplier it has in the market.

5.)    Threat of Substitutes – Ranking 1 Although there is the threat of substitutes in the market, this is actually a weak market force because the substitutes available are limited.

Based on the porter's analysis the industry where Remcor operates is very bloody. Not moving over to best practices and formulating company strategies would surely sink the company like the Titanic. Taking all these factors into consideration, an ERP solution can address the need of Remcor to compete effectively in it's market as well as to scale its unrealized revenue due to inefficiencies in its operations, hampering its growth. Developing its internal processes will help the company remain competitive in the auto parts manufacturing industry. With the use of an ERP system, Remcor will be able to streamline its supply chain management operations. Their supply chain management would be more efficient and Remcor will be more able to meet the demand required by their customers. Proper material planning, managing check inventory fulfillment levels and demand forecasting can be done in real time and more efficiently, realizing their potential revenue.