Motor Cycle: Industry Analysis Sample Essay

Motorcycle is one of human’s great innovations that add convenience to transit jobs. Here in the Philippines. the bike market is turning.

More Filipinos prefer bikes as their agencies of transit because they find more convenience in bike siting than transposing.Transportation system Vehicles is really of import here in the Philippines. It allows Filipino people to hold a more convenient and easy life. The Government Vehicle Assembly Program has 4 categorizations: the Passenger Cars. Commercial Vehicles. Motorcycle and other Vehicle Assembly.The graph below shows the historical gross revenues and demand prognosiss of bike in the Philippines. The entire demand expected to make 0.

941 M units by twelvemonth 2013.In the nose count of auto and bike enrollment made by the Land Transportation Office ( LTO ) in its 4 old ages of operation get downing 2006 to 2009. 3.

200. 000 riders and 750. 000 auto proprietors were recorded. This shows that the bike riders are four times greater than auto proprietors.

This lone implies that bike industry has been fast turning industry since so.Areas of CompetitionI. Merchandise
In the universe of conveyance the bikes are besides really normally used. They are used due to their sleek design and easy to drive. The bikes are besides to keep and look after.

The bikes are besides preferred by the people as they are an easy manner to acquire out through traffic jams and through heavy traffic. Keeping this in head. many companies make bikes and here are few of them. These all companies are Nipponese and has their central offices in Japan. Here are few differences and facts about these companies Yamaha bikes is a Nipponese motor rhythm company which is founded in the center of 1950’s and is doing rushing. crossing overs and trail motorcycles.

It includes all types of minibikes runing from 50 to 1900 milliliter while Honda Motorcycles is the largest bike bring forthing company across the universe and has its central offices in Japan and is celebrated for doing new. alone bikes.The Kawasaki Motorcycles is the Motorcycle Company which is celebrated for its trade names of doing heavy weight motor rhythms with the epicurean expressions and heave on responsibility organic structure type and Suzuki Motorcycle besides produce motor rhythms and is founded in the twelvemonth 1909. It started the production in the center of the nineteenth century and is besides a portion of the celebrated MOTOGP race.

Different bike companies use different schemes in selling their merchandises such as supplying every person an appropriate bikes for their convenience. Their market mark includes any type of rider. including adult females. teens. and aging babe boomers. This companies has different manners and differentiations in their merchandise. Honda has been at the head with planing elegant.

modern-day and powerful scooters and entry-level bikes.College pupils or immature adult females who do non desire bulky motorcycles are the mark of this company. The company has been able to stay highly strong in the industry because of its ability to provide to the demands of its assorted consumers. It systematically advances the engineering of the industry. such as the creative activity of the world’s first bike airbag system. Honda has had considerable success against competition. Like its closest rival Honda.

Yamaha. Suzuki and Kawasaki is present in many different bike classs. They rely strongly on the success of gross revenues in the bike rushing class. They compete in the market by stressing the on and off route capablenesss of their motorcycles. They put accent on soil and street racing. doing the motorcycles seem immature. fast.

and merriment.Sample Merchandises of the BIG 4 Motorcycle ManufacturerII. Monetary valueThe monetary values of bike depend on the characteristic. manner and capablenesss of the merchandise. They have close competitions in footings of product’s monetary value. Below is a sample monetary value list of Suzuki and Yamaha.

III. Topographic point of OperationIn footings of topographic point of competition. this Large 4 Motorcycle Company have been known worldwide. They are selling quality merchandises around the universe through their 1000s of subdivisions and shop worldwide.

Here in the Philippines. these companies have been providing bikes nationally. They had their ain chief subdivision here in the Philippines and different shops countrywide. They make their merchandise available to market every bit much as possible
IV. PromotionThese top Rivals of bikes had their ain manner of advancing their merchandise. They venture on athleticss such as football. racing. and more.

Besides they promote their merchandise through different media. They use telecasting. newspaper. wirelesss and cyberspace in advancing their merchandise.

Dickering Power of BuyersThe bulk of the bike industry’s client group consists of single consumers. Motorcyclists tend to be between 25 and 65 old ages old and are likely to hold been gaining their ain income. Majority of bike purchasers are work forces. Nowadays. female ownership of bike has besides increased.

Normally. bike proprietors are bluish collar workers. or people who makes who do manual labours.

Merely few white collar workers or people who make administrative and managerial occupations desired to have a bike. Generally. bike purchasers are people holding an approximative income of Php20. 000.

00 and below every month. This client group does non hold strong bargaining power over the bike industry because it neither has power comparative to industry participants nor emphasizes monetary value decreases. The bike industry client group is scattered instead than concentrated since it consists of persons. Switch overing costs for bike proprietors are high.

Besides. the industry’s merchandises.

with legion trade names. manners. and monetary value points. are really differentiated.

so consumers can non straight compare one merchandise to the following. Most of the bike clients are monetary value medium. Since a bike is a comparatively expensive point. purchasers are likely to seek a favourable monetary value.

The fact that most of the company traders are offering promo such as installments and gross revenues in order to pull more clients is grounds. Despite of this low monetary value strategy it does non impact the low net income of the marketer. it is merely an strategy that prolong the torment of people in paying and delayin the net incomes received by the marketer.More significantly. clients are besides sensitive to quality and trade name image every bit much as its monetary value. A bike purchase is besides a contemplation of one’s individuality and influences how others perceive them. Aside from monetary value. one of the most of import factors that have a large influence in a buying determination were manner and design.

trade name name. public presentation. and managing. Merely few purchasers who are good educated and interested in bike choose their motorcycle based on engine capacity and type. such as patrol car.

touring. athletics. criterion. trail. and rushing.

Despite the fact that Filipinos are after a low monetary value but good quality merchandise. it is non adequate to impact the profitableness of the Sellerss.The clients in the bike industry do non hold much dickering power to coerce down monetary values. demand higher quality or service. or play rivals off against each other.

2. Dickering Power of SuppliersMotorcycles are comprised of a important sum of different constituents. The human body. engine. cylinders.

chilling system. transmittal. clasp. gear box. suspension. braking systems.

and tyres are merely a few of those constituents. Some of these parts can be manufactured in-house by the bike makers. such as Honda. while it would be more cost effectual to order other parts from outside providers.

Motorcycle makers need to take which constituents they will fabricate and which parts of the production procedure will be outsourced based on what is most cost effectual. We can deconstruct the two major fabricating procedures. in-house produced parts and parts supplied from outside companies. to analyse the beginning and strength of the providers for each production procedure. Partss deemed more cost effectual to be produced by the bike maker itself will be supplied by providers of natural stuffs. such as aluminium. plastics. steel.

and other assorted natural stuffs.
These resources are extremely uniform trade goods. The shift costs are comparatively low between different providers as a consequence of them being extremely undifferentiated. Suppliers of a certain natural stuff will probably make everything in their power to maintain a big maker.

such as Harley-Davidson or Honda. as their client. Therefore. providers of natural stuffs to motorbike makers do non hold important bargaining power. The 2nd major beginning of bike parts comes from providers of constituents supplied by outside companies. These constituents will necessitate a high grade of specialised labour and specialised equipment. which makes it more cost effectual for these parts to be supplied from the exterior. This is rather similar to the automotive vehicle industry.

where about all major constituents are supplied from outside beginnings.There are 100s of automotive parts providers and a significantly larger work force within these automotive parts providers. All of the providers are viing for concern from one of the few major makers.

This is the same state of affairs in the bike industry. Many providers are viing for the concern of Honda. and Kawasaki.

Due to the fact that are a important figure of providers and frequently times these providers are merely supplying the fabrication of parts. non the design of parts. Therefore among these providers. they are extremely uniform and it is rather easy for a big bike maker to exchange to one of the many abroad makers of different parts. The providers of these constituents do non hold important bargaining power. Throughout both of the production processes of bikes. one major supply beginning with the highest grade of dickering power is the supply of the manufacturer’s labour.3.

Menace of Substitute MerchandisesWhen analysing the competitory menaces on the bike industry as a whole. the bike trade association members must maintain in head two chief replacements for bikes: bikes. undersized autos. Each of these replacements can be farther broken down into subcategories. Each class is considered a replacement for bikes because it either satisfies at least one of three costumier demands that motorcycles satisfy.

or it gives the costumier something that bikes do non offer. Though the degrees of menaces posed by each class of replacement differ greatly. the bike trade association members must be certain to turn to each of them when make up one’s minding where to travel from here. Most significantly.

maintain in head that these menaces are of all time present. and if the assorted bike makers do non move shortly. they will put on the line losing clients throughout the coming old ages.
First of all. it is of import to understand what motorcycles do for purchasers because this sets up a model for the implicit in motive behind the purchase of any type of bike.

Since the bike industry is responsible for planing and fabricating approximately seven different sorts of bikes. or other automatic two-wheel vehicles. several client demands are met by each class: agencies of transit.

low fuel costs. environmentally friendliness. recreational activity. and “cool factor. ” In add-on. we will analyse another factor that motorcycles lack Bicycles are besides a menace to the bike industry based on a few critical factors. First.

as two-wheel transit vehicles. they are similar in basic map to bikes. fulfilling the consumer demand of basic transit from point A to point B. On a more practical note.

bikes do non normally travel much faster than 25 miles per hour. and many roads are non really bicycle-friendly or safe to sit on. An extra ground why bikes make feasible options to bikes is related to the consumer’s need to pass less money. Bicycle proprietors incur zero gas milage costs. doing this alternate the most environmentally friendly option.To be proficient. the lone existent costs associated with bikes are the upfront purchase.

care. optional accoutrements. and human labour. In add-on. bikes satisfy the consumer’s demand for recreational activity similar to bikes. Anyone from the mean consumer to the devouring biker can utilize a bike as an alternate agencies of out-of-door diversion.

However. bikes are non by and large associated with the “cool factor” that is associated with bikes. and this is one of the most influential factors for the bike industry. Harmonizing to bike partisans. “The [ cool ] factor is one of import component and one of the grounds why many are siting a bike.

” Similar to bikes. bikes are non every bit safe as autos. and accidents go on more often on motorcycles than in autos. Despite the ruins. bikes are feasible replacements and present a moderate menace to the bike industry. Compact autos and loanblends are the concluding and most influential categorization of replacements that pose an immediate menace to the bike industry.Overall. both types of autos present high shift costs to the consumers.

Although bikes are more fuel-efficient than even the best loanblend or smallest auto. the safety factor makes compact autos and loanblends more attractive to some consumers. Compact autos and loanblends are safer than bikes because they by and large have seat belts. airbags. and a shell that protects the driver. For many consumers. increased safety is a actuating factor in purchasing a compact auto or loanblend over a bike.

In add-on. compact autos can be replacements for bikes due to their compact size. measurement merely a few pess long. Much like bikes. these little autos can suit into the bantam parking infinites and squeezing through tight musca volitanss.

Compact autos are besides going really voguish in some countries because of their freshness. In this regard. the two somewhat compete on image-related consumer demands. Overall. we perceive fuel efficiency and safety to be the most of import factors on which compact autos and loanblends pose menaces to the bike industry.

4. Menace of New MerchandisesThe adulthood. big figure of rivals. and high capital demands needed to come in the bike industry make it a reasonably unattractive industry for new rivals to come in.

A more complete and elaborate analysis of the seven barriers to entry will demo the bike industry to be a hostile. unreceptive environment for new entrants. As a mature industry. current rivals enjoy the benefits ensuing from economic systems of graduated table. Established bike manufacturers have the luxury of lower costs per unit because they can apportion their fixed costs to a larger figure of merchandises. New entrants do non hold as big of a demand and must administer their costs over a smaller measure.

Because of this. single costs per unit are larger. ensuing in a higher merchandise monetary value.

Large providers have an advantage over little. new entrants based on the web and trade name association connected to the big provider. By buying a big supplier’s merchandise. the consumer belongs to an expansive web of consumers.
Another benefit of graduated table enjoyed by the providers is the consumer’s premise of quality attached to a trade name. Buyers have a inclination to put a higher degree of trust in companies with high trade name acknowledgment. They correlate high trade name acknowledgment with high quality.

a cardinal factor when buying a motorcycle. For illustration. an uneducated consumer looking to buy a high public presentation street motorcycle would be more inclined to buy a Honda or Yamaha over a Buell motorcycle because they recognize the other two as leaders for public presentation motorcycles and would be more certain of the quality and public presentation of those merchandises compared to Buell. Another factor prefering current industry participants is the high shift costs for consumers. Particularly for consumers who purchase bikes for more than the mean monetary value. the purchase is a long term investing.This makes it hard for new entrants to steal market portion from current consumers in the bike industry. Besides the trouble new entrants find in pulling clients.

another hindrance to entry are the high capital demands demanded by the industry. Characteristic of a mature industry. monetary value is no longer a differentiating factor among similar merchandise offerings by different rivals.

Leaderships in the bike industry. such as Yamaha. now differentiate their merchandises by supplying “high-value-added products” at their ain franchises. For new entrants to come in the market and take away current market portion from bing rivals. high capital investings in substructure.

franchises. development of new merchandises. and publicities aiming specific client sections are required. An overarching tendency refering distribution channels within the industry are manufacturers who chiefly distribute their merchandise through their ain franchises.A major lending factor to this tendency is the trade name trueness demonstrated by consumers The trade name power possessed by current rivals within their mark markets are being utilized in multiple ways.

including their distribution channels. New entrants have non had an chance to increase their trade name trueness. doing that distribution channel non as efficient and have few options other than independent retail merchants. An increasing tendency in the cost of natural stuffs needed for production adds value to the long term relationships many current rivals have with natural stuff providers.Incumbent companies with established histories with providers may hold bing contracts with costs lower than current market monetary values due to recent monetary value additions. Once once more. the new entrants will hold to pay the current higher cost instead than the discounted cost paid by officeholders. High capital demands.

increasing demand. and specialised merchandises are factors lending to the high barriers to go out the industry. Current rivals keeping the bulk of the market portion are hesitant to go forth the industry because of the positive industry mentality and niche markets each have carved out for themselves. With few companies go forthing the industry. it leaves really few market sections untapped and available to new entrants.5.

Intensity of Competitive RivalryRivalry among rivals in the bike industry is comparatively intense. While each major rival has its ain market niche. monetary value discounting. new merchandise debuts.

advertisement runs. and inventions in bike engineering systematically fuel competition between houses. Rather than viing based on monetary value. the major participants in the bike industry tend to vie based on services and characteristics. Each major company offers different types of merchandises targeted to different consumer sections. There is a high degree of distinction between categories of merchandises and trade names. doing high shift costs for consumers. Accessories and parts are produced for one specific trade name.

In add-on. borders are non low. and the merchandise is non perishable. Because of these factors. competition does non be given to gravitate towards monetary value every bit much as other factors.

Even though monetary value is non the chief footing of competition in the bike industry. the strength of competition is really high. The industry is composed of five distinguishable leaders. each of which is big and has high trade name equity. Because the industry lacks a unequivocal leader. challengers end up poaching each other’s concern.
Additionally. the sheer figure of rivals in the market in add-on the chief five creates an copiousness of buying options for the consumer and do heavy competition.

Rivals in the bike industry have diverse attacks and thoughts on how to vie. While one company might believe that adding new characteristics to their merchandises will assist hike gross revenues. another company might believe that increasing velocity capablenesss will be more good. Another company might believe that offering easy funding is the key. Companies are invariably viing against each other to make the “next large thing” and pull as many clients as possible.

This clang of thoughts and techniques creates an industry where diverse personalities and attacks sometimes clash or create intense competition. Despite high degrees of competition. the bike industry has been turning steadily since the 1980s. In the yesteryear. bikes were considered to be a signifier of diversion or amusement.

Typical bike proprietors used their bikes as a complement to their autos. However. many people are now sing them as an option to autos. Because of high gas efficiency. the ability to steer around traffic. and the monetary value of a bike compared to a auto. the bike industry continues to turn.

The chief scheme used by bike companies is merchandise cleavage. There is a motorcycle available for any type of rider. including adult females. teens. and aging babe boomers. While there are many rivals in the bike industry. the five most important are Honda.

Yamaha. Kawasaki. and Suzuki. Hondahas been at the head with planing elegant. modern-day and powerful scooters and entry-level bikes.It tends to aim college pupils or immature adult females who do non desire bulky motorcycles.

Honda consumers tend to be between 25 and 65 old ages old and have a middle-high family income. Honda has been able to stay highly strong in the industry because of its ability to provide to the demands of its assorted consumers. It systematically advances the engineering of the industry.

such as the creative activity of the world’s first bike airbag system. By publicizing its strength in inventions and edifice upon its already established trade name name. Honda has had considerable success against competition. Like its closest challenger. Honda. Yamaha is present in many different bike classs. All three companies rely strongly on the success of gross revenues in the bike rushing class.

They compete in the market by stressing the on and off route capablenesss of their motorcycles. They put accent on soil and street racing. doing the motorcycles seem immature. fast. and merriment.


I'm Tamara!

Would you like to get a custom essay? How about receiving a customized one?

Check it out