Porter’s Five Forces Analysis of Intel 

Intel is a technology semiconductor chip manufacturing American multinational company. The tech service providing and semiconductor company started its business in 1968. Today, we’ll discuss Porter’s five forces analysis of Intel; bargaining power of suppliers and buyers; threat of new entrants and substitutes; and intense rivalry as competitive forces in strategic management.

Raw Material for Intel Semiconductor Chips and CPU

• Silver
• Gold
• Plastic
• Aluminum
• Copper
• Silver
• Silicon

Substitute and Competitors of Intel

• Qualcomm
• Nvidia
• AMD

Porter’s five forces analysis of Intel would analyze the bargaining power of suppliers and buyers; the threat of new entrants and substitutes; and intense rivalry as competitive forces in strategic management. Here’s Intel Porter’s five forces analysis of semiconductor chip manufacturing business as follows;

Porter’s Five Forces Analysis of Intel

Let’s discuss the Porter’s five forces analysis of Intel as competitive forces in strategic management and they’re as follows;

Bargaining Power of Suppliers in Intel

The bargaining of suppliers is Moderate in the semiconductor chip manufacturing business as competitive force in strategic management. Some of the main factors impacting the bargaining power of suppliers in Intel Porter’s five forces analysis of semiconductor chip manufacturing business are as follows;

I-Rare Elements

Some of the raw materials are easily available like plastic, steel, silicon, and others. But gold is a rare earth element, and only a limited number of suppliers and vendors deal with gold due to its expensive. Limited availability of raw supplies and suppliers would increase the bargaining power of suppliers.

II-Reliance on Suppliers

Overall, Intel heavily depends on suppliers for raw materials and suppliers to carry out the production of chips and CPUs. Without the presence of raw supplies, the technology can’t perform its production processes.

In order to decrease the bargaining power of suppliers, Intel collaborates and partners with multiple suppliers. In fact, the company has built a very strong relationship with suppliers to ensure to smooth availability of raw supplies.

Bargaining Power of Buyers in Intel

The bargaining of Buyers is lower in the semiconductor chip manufacturing business as competitive forces in strategic management. Some of the main factors impacting the bargaining power of suppliers in the Intel five forces analysis of the semiconductor chip manufacturing business are as follows;

I-Limited Alternative

There are very few manufacturers of semiconductor chips, CPUs, circuits, and other hardware components for computers and smartphones. Customers are heavily relying on them to make their machines, computers, and other smart devices work and function. They can’t easily switch from one type of component to another without incurring a lot of cost and resources. It decreases their bargaining power.

Threat of New Entrants in Intel

The threat of new entrants is lower in the semiconductor chip manufacturing business as competitive forces in strategic management. Some of the main factors impacting the threat of new entrants in Intel Porter’s five forces analysis of semiconductor chip manufacturing business are as follows;

I-Strong Infrastructure

Intel has established a strong infrastructure of chips semiconductor and CPU manufacturing factories in various countries worldwide. In order to achieve profitability, Intel carries out its production and manufacturing operations at a mass scale. On the other hand, the new firms in semiconductor chip manufacturing won’t have the resources to perform their operations at a mass scale.

II-Expertise & Expensive

Along with mass-scale operations; Intel has years of expertise and experience in procuring the right expensive material supplies, processing them without wastage, and carefully producing the finished product. The new firm won’t have the experience to rightly carry out all the operations; because any type of error would cost the company heavy losses, due to the expensive material.

Threat of Substitutes to Intel

The threat of substitute products and brands is lower in the semiconductor chip manufacturing business as competitive forces in strategic management. Some of the main factors impacting the threat of new substitutes in the Intel five forces analysis of the semiconductor chip manufacturing business are as follows;

I-Limited Alternative

Qualcomm, AMD, and Nvidia are the three main alternative options for customers and companies for smartphones and computers. Limited alternative options decrease the substitution rate; because these all firms work on the close deadline to meet the demand of client companies.

II-High Switching Cost

Customers can’t simply change the chipset, CPU, and other components of their computers and smartphones. It is because they don’t have sufficient knowledge and tech experience to do so. Often, you have to change the whole device, instead of just changing a few parts.

Competitive Rivalry in Intel

The competitive rivalry among semiconductor chip manufacturing companies is very high as competitive forces in strategic management. Some of the main factors impacting competitive rivalry in Intel forces analysis of semiconductor chip manufacturing business are as follows;

I-Tough Competition

Intel is facing tough competition from competitive brands like AMD, Qualcomm, Nvidia, and others in the chips, semiconductors, AI, CPU, and data service industry. They all offer the same type of service with almost similar type of quality and pricing, and their market presence poses a significant challenge to the technology company to maintain its market share.

Conclusion: Intel Porter’s Five Forces Analysis |5 Forces Analysis of Intel

After an in-depth study of Porter’s five forces analysis of Intel; we have realized that Intel is the world’s leading semiconductor chips manufacturing brand. If you are learning about the Intel 5 forces analysis of the semiconductor chip manufacturing business; then you should keep in mind the abovementioned bargaining power of suppliers and buyers; threat of new entrants and substitutes; and intense rivalry as competitive forces in strategic management.