Analysis of the Business Lending Industry Through Porter's Five Forces
Updated: Aug 20
Analyzing Alternative Business Lending Using Porter's Five Forces
Porter's Five Forces is a framework developed by Michael E. Porter to analyze the competitive landscape of an industry. The model identifies five undeniable forces that determine the overall competitive intensity and attractiveness of a market. Porter's Five Forces Model helps managers and analysts understand the competitive landscape that a company faces and how a company is positioned within it.
These forces are:
Rivalry Among Existing Competitors
Threat of New Entrants
Bargaining Power of Suppliers
Bargaining Power of Buyers
Threat of Substitute Products or Services
Why Create This Analysis
Creating a Porter's Five Forces analysis is beneficial for companies as it helps them understand the competitive dynamics within their industry. By evaluating these forces, companies can identify their strengths and weaknesses, uncover potential threats and opportunities, and develop effective strategies to gain a competitive edge. This analysis also helps companies make informed decisions about market entry, product diversification, and resource allocation, ultimately contributing to their long-term success.
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About the Author
Shane Mahabir is the founder of Funder Intel, the business lending industry's media and intelligence platform, where he has worked in, covered, analyzed, and connected the alternative financing market for more than a decade. He built proprietary datasets, including the Deal Tape capital-markets database, the RBF & MCA Market Volume Database, and the Commercial Financing Regulation Tracker.
