Porters Five Forces of the Complementors

Target – Porter’s Five Forces and of
the Complementors

Student
Name

Institutional
Affiliation

Course
Name and Number

Professor’s
Name

Assignment
Due Date

Target – Porter’s Five Forces and of
the Complementors

Currently,
the retail industry is growing competitively within the US and internationally.
Every retailer business is pushing to attain better market share and enhance
competitive advantage over competitors. Porter’s five forces and complementors
analysis is an analytical tool that helps position an organization within the
marketplace. For Target Corporation, there are three strength levels to define
Porter forces’ applicability. For instance, the power of buyers and suppliers
score low.

The
bargaining power of buyers is low because Target sells large product ranges. However,
the customers have different choices, including e-retailers and traditional
retailers. This explains why Target continuously offers goods at a low price,
yet its brand image is better and has a positive reputation (Capell, 2019).

Secondly, Target
has a low strength level for the bargaining power of suppliers. This is major
because of its size as no single supplier is large enough to place an efficient
influence on Target operations. This limits Target’s chances of forward
integration, and this causes Target to have less control over the
suppliers.

Target has
new entrant and substitution factors within the medium strength level. For
instance, the threat of a new entrant is an expected change Target will face
following the entry of a big brand. Small brands may not pose a major challenge
for Target due to limited branding and the establishment of a strong presence
(Capell, 2019).

In addition,
the threat of substitutes averagely impacts Target’s overall performance
following the presence of both large and small retailers offering similar
products, including Amazon and e-bay. Target has strategized on how to retain
its client base through lowering the prices to enhance proper sales.

Target’s
strongest aspect is the competitive rivalry within the retail industry since
there are many players. Every player poses a competitive threat, which influences
how Target functions by utilizing its resources. Target’s main competitors keep
it at bay on performance prospects, and examples of these include Amazon,
Walmart, and Amazon.

Target’s
complementors entail businesses directly selling its products and service,
which complements what another organization does towards sufficient added value
on mutual productivity. Target’s main complementor includes Sam’s Wholesale
Clubs for innovative retail service provision.

References

Capell, A. (2019). Strategic Audit: Target
Corporation.

Deilen, M., & Wiesche, M. (2021, March).
The Role of Complementors in Platform Ecosystems. InInternational
Conference on Wirtschaftsinformatik(pp. 473-488). Springer, Cham.