Essay About Large Number Of Competitors And Micro Environment

Micro Environment
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Micro environment is near environment. This environment is actually the direct surrounding of the firm that determines firm
position in competition. This environment can be explained using Porter five forces Based on Porter, firm position
is characterized by rivalry, threat from product substitution, threat from new entrant, bargaining power of supplier and
bargaining power of consumers.
A large number of competitors especially from Wintel family create a red ocean for Apple. Wintel platform is not produced by
single firm rather than combination of firms. These competitors offer similar product to apple with only little different in
features, brand and design. Several Apple competitors are IBM, HP, Compaq, Dell, Lenovo, Gateway, Acer, Fujitsu, Sony, ECS,
Toshiba, etc.
Strong bargaining power of suppliers creates high cost of computer components. As there is only small number of processor
suppliers and only small of them has capability and willingness to provide the best for Apple, the bargaining power of supplier
is high to the Apple. This condition made the price of processor component is high.
At the other side, the great number of competitors with similar product specification and the birth of Internet are also
strengthening the bargaining power of final consumers. This limits the ability for Apple set price too high.
Low threats of substitute product also characterize the industry. Besides Wintel personal computer, there are no pure
substitutions for Apple personal PC. Since Wintel personal computer is the same kind of product with Apple, it is considered as
rivalry instead of product substitution.