The advancing technology has narrowed the knowledge boundary amongst the organizations, necessitating innovative approaches that would provide their goods and services with differentiating elements to give them cutting edge leverage. Analysis and identification of the changing trends of the customer requirements are essential ingredients to gain leverage against their rivals (Grant, 2007). In such a scenario, the five forces analysis of producer business becomes critical factors of a competitive advantage, which are: industry rivalry, bargaining power of suppliers, bargaining power of buyers; competition from substitute; and the threat of entry.
The industry rivalry amongst the producer businesses is an essential criterion for introducing cutting edge differentiating elements in the products to gain leverage. This is one of the primary motivating factors for Samsung Inc to be highly innovative in its products and development processes.
The quality and creative input within the product gives a huge advantage to the suppliers and puts him in a bargaining position. Samsung producing high-quality memory chips at relatively low cost has been able to bargain with its customers.