Industry Attractiveness

Table of Contents
1.0 Introduction1
2.0 Analysis of the Domain:2
2.1 The Entrepreneurial opportunity:2
2.2 Industry Attractiveness:2
3.0 Conclusion4
References6
Appendices7

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1.0 Introduction
Porter five forces is defined as the model that determines and analyses five competitive forces

that develops industry and helps to identify the strengths and weaknesses of the industry. Five

forces analysis is applied to determine the structure of the industry to analyse the corporate

strategy. Therefore, the Porter’s model can be used to any of the segments of the economy to

determine the competition level within the industry and develop the long-term profitability of the

company. Porter’s five forces are defined as the business analysis model that supports to

determine why the industries are able to sustain the effective levels of profitability. In this

relation, it may be analyse that, the strategic analysts impellent the usage of framework for

analysing the competition along with the positions of the product or the organisation and with the

competitive advantage of the particular products brand pure water in 7 izoare.

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2.0 Analysis of the Domain:
2.1 The Entrepreneurial opportunity:
Bottled water is the fastest developing segments of the global market. In reference to appendix 1,

the bottled water market is estimated to reach EUR 57.09, registering a CAGR of 2.18% during

the estimated period in the year 2019-2024. The bottled water can be a well-established market,

due to which the rate of growth can be low (Mordor Intelligence 2019). Emerging customers and

the consumption of contaminated tap water attribute this. Pet bottles can be used type of package

in bottled water industry. Italy, Spain and Germany are defined as the major bottled water

markets in Europe. The growing concerns within the population caused by plastic are bounding

the players to shift within the environment friendly packaging.

Unfortunately, only 19% of the resources are being exploited. As the new venture will focus on

Due to geologic soil structure, Romania possesses effective resources of pure water, collected in

2000 springs, dominated by natural mineral water. In the relation to the bottled water industry, it

have been estimated that 10.3 million hectolitres are bottled annually in Romania with domestic

competition accomplishing 32 million hectolitre with an appropriate rate of growth of 4%

annually (UKR Export 2019). From that competitive market, sourcing the mineral water from the

7 Izovare springs and selling in the UK can become costly though the market demand of UK can

help in covering the cost related with the entire supply chain management of the business.

2.2 Industry Attractiveness:

Level of Rivalry among the product brand of bottled water in UK:

Level of rivalry categorise the main intensity of the competition in an individual industry to

accomplish a specific segment of target market and is further identified by the factors such as

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diversity of different rivals along with the relative growth of the growth to which the industry

can be considered as mature or young. UK’s trade of mineral waters focused on the upward trend

within the last 5 years, analysed by the proper involution because of universal annual crisis.

There are many rival brands of mineral water such as Evian, Highland Spring Water, Buxton

Spring water, Volvic, Tesco, Sainsbury, ASDA, Vittel and many more (Statista, 2019). It shows

that the rivalry is high with every company is having quite similar market share though

companies like Evian, Highland Spring and Buxton are the main leaders in the mineral water

market in UK.

Bargaining power of buyers

Bargaining power of the buyers would be high. Initially, there are many bottled water lines along

with non-water alternatives to select. In addition to this, there would be no such major cost for

the customers. Lastly, although it would be further growing, the loyalty of the brand is not strong

in the industry (Mordor Intelligence 2019). More customers are not specific about the brand and

along with the result, they focus to choose the product items with the reduced rate. Therefore

high buyer power may place load on bottled water companies to reduce the price.

Bargaining power of suppliers

If the organisation is selling spring water, they mostly install the necessary infrastructure to

gather, bottle and filter the water. If they sell purified water, they tap the water from different

municipalities at the industrial rates and further purify the water on their own. In the other way,

the firm in the bottled water industry, do not require buying the water from the supplier, they get

on their own. Therefore, bargaining power of suppliers seems low. However, as the current

business concept is about collecting spring water from Romania, a well developed supply chain

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management is required where suppliers need to play a vital role due to which the bargaining

power of suppliers may increase as from collecting to delivery to shops, the company will need

to be dependent on the suppliers and associates.

The threat of new entrants

Initially the competitors existing would be large as well as dominating companies, which already

own a huge share of market of the industry. Emerging entrants attempting to enter the market

will have the huge competition with the established market. Secondly, it would be expensive to

develop the entire infrastructure to enhance the products. Therefore, it have been stated that the

price for bottle filling lines further ranges from EUR 113,453.22 to EUR 90.7626not to develop

the costs linked with the source certifications (UKR Export 2019). Therefore, the threat of new is

low due to the cost of the total infrastructure.

Threat of substitute service or products

Substitute is defined as those products or goods, which seem to be different but it can further

satisfy the same requirement as the other product. Therefore, the competition of selling the

bottled water would be created by the major threat of substitute products arising from outside the

country. Another major substitute would be devices related to filtration such as Brita filter that

filters tap water. Aa most consumers tend to buy waters in low prices, the substitute products

may create issues for the mineral water market.

3.0 Conclusion

From the above study it have been discussed that, bottled water is defined as the fast developing

segments of the universal market. Therefore, UK is determined as developing the market for the

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main consumptions of mineral water as well as with the significant source of natural springs with

the development of expanding domestic sector oriented to enhance the potential assessment.

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References

Mordor Intelligence, 2019, about: Europe bottled water market - growth, trends, and forecast

(2019 - 2024), Available at: https://www.mordorintelligence.com/industry-reports/europe-

bottled-water-market [Accessed on 30 November 2019]

Statista. 2019. Leading brands of Bottle Mineral water in the UK. Available at:

https://www.statista.com/statistics/308644/leading-brands-of-bottled-mineral-water-in-the-uk/

[Accessed on 30 November 2019]

UKR Export, 2019, about: Mineral Waters, Available at:

http://ukrexport.gov.ua/i/imgsupload/file/Romania%20-%20Mineral%20Waters%202012r.pdf

[Accessed on 29 November 2019]

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Appendices
Appendix 1

Figure 1: Industry Attractiveness

(Source: UKR Export 2019)