The competitive environment of Harvard would be studied through Porter's 5 forces analysis which would highlight the degree of rivalry in the market.
Presently we can see that the adhesive market has a high growth capacity due to the existence of fragmented segments with Harvard delighting in management and a combined market share of 75% with 2 other industry gamers, Eastman and Permabond. While industry competition between these gamers could be called 'intense' as the consumer is not brand mindful and each of these players has prominence in regards to market share, the truth still stays that the market is not saturated and still has a number of market sectors which can be targeted as prospective specific niche markets even when launching an adhesive. Nevertheless, we can even point out the fact that sales cannibalization may be resulting in market rivalry in the adhesive dispenser market while the marketplace for instant adhesives offers growth potential.
Bargaining Power of Buyer: The Bargaining power of the purchaser in this industry is low particularly as the buyer has low understanding about the product. While business like Harvard have managed to train distributors concerning adhesives, the final customer depends on distributors. Approximately 72% of sales are made directly by producers and suppliers for immediate adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Provided the reality that the adhesive market is controlled by 3 gamers, it could be said that the supplier delights in a greater bargaining power compared to the buyer. The reality stays that the supplier does not have much impact over the buyer at this point especially as the purchaser does not show brand name recognition or cost level of sensitivity. This indicates that the supplier has the greater power when it pertains to the adhesive market while the buyer and the maker do not have a significant control over the actual sales.
Threat of new entrants: The competitive environment with its low brand name commitment and the ease of entry shown by foreign Japanese competitors in the immediate adhesive market indicates that the market allows ease of entry. If we look at Harvard in particular, the company has double abilities in terms of being a producer of instantaneous adhesives and adhesive dispensers. Prospective risks in devices dispensing industry are low which shows the possibility of producing brand name awareness in not only instantaneous adhesives however also in dispensing adhesives as none of the market players has handled to position itself in double capabilities.
Hazard of Substitutes: The risk of replacements in the immediate adhesive industry is low while the dispenser market in particular has replacements like Glumetic suggestion applicators, built-in applicators, pencil applicators and advanced consoles. The fact stays that if Harvard presented Bond-A-Matic, it would be delighting in sales cannibalization for its own items. (see appendix 1 for framework).
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