Business Summary - Inventec

1. disrespect its growth and size, why is Inventec not very remunerative?\nIntensity of rivalry against existent firms: There ar about firms which provide similar or identical products as Inventec to the market. i.e Compal, Quanta, Mitac etc. As a consequence, there is a small full stop of differentiation of products. Firms compete for each one other by its agonistic prices and consumers have low switch over be between these brands because of their simile in functions and designs. Thus, lowering the gain gross profit.\nThreat of new entrants: payable to Taiwans low government restrictions on firms entering this ODM industriousness, new entrants argon able to enter the exertion and willing present a challenge to the existing firms in the market. Therefore, the increase of supplies and substitutes impose a challenge to existing firms.\n\n negotiate Power of Buyers\nInventecs sales are mainly from HP and Toshiba and Inventec is cowardly to lose these two major(ip) ve ndees. Consequently, these major clients has higher(prenominal) dicker power on the set which often lowers Inventecs profit margins. Inventec has to direct the aggressive pricing from buyer because of its limited client list. ODM industry is a very agonistical market where Inventec has to face two internal and external factors. Despite its growth and size, Inventec only could claim low margins due to the minacious pressure from the customers and competitive firms.\n\n2. What are the drivers of the average profitability of the overlord Design and Manufacturing industry?\n price Leadership Method\nBy achieving economies of scale during production process, this could saves and reduces costs effectively and gain higher margin.\n\nBargaining Power of Suppliers\nSuppliers study to be alert on market prices to bargain with customers in order to retain supra average profit margin and yet keeping them as long term customers.\n\n war-ridden Pricing\nCompetitive firms will lower their prices to gain to a greater extent sales volume. With all the firms competin...