Select an industry from the list below and describe the relative attractiveness of entering that industry.
university text books, religious literature, fictitious novels on all subjects, cooking stuff, books on international relations and current affairs etc. However, the industry has observed a sharp decline in growth after advent of electronic commerce coupled with recent economic turmoil that further hampered its growth. This will be discussed in detail in the following section when author will present real world scenario. (Foner Books Report, 2010)
The author would now provide an analysis on Book Selling Industry across USA by using Porter’s Five Forces model. Each force will be discussed in detail so that a reader could have a clear insight about the scope and business potential in this industry.
It should be pointed out that book buyers in USA could be divided into two major groups such as core students (the educational text books market) and book lovers (that tend to buy books on various subjects). The bargaining power of core students has increased considerably in last 2 years because of decline in demand of school, college and university education. Indeed, the reasons behind that include lack of short - term unemployment opportunities followed by surge in inflation, which compelled the students to take semester or yearly breaks. In this way, decline in demand of students sharply reduced the demand of course or text books, thereby leading to decline in book selling activities. As far as demand from book lovers are concerned, it should be emphasized that bleak employment prospects and decrease in consumer purchasing power also forced potential buyers to tighten their belts and reduce spending on books. For instance, today book lovers also demand higher value for the money they spend in the market. Hence, it is worthwhile to point out the fact that increase in bargaining power of consumers has resulted in downward pressure in pricing.