This is an essay about Business Policy course.
Porter Five Forces for Canopy Growth
Competitors- Canopy Growth has a great deal of competition the company must look out for. One of the main competitors is Aurora Cannabis because Aurora so far have been 20 percent of the marijuana market in Canada. Also they produced over 700,000 kilograms per year. Another competitor that Canopy Growth must watch out for is Cronos Group because Cronos used to be on top of the race to become the alpha company but due to being to slow on establishing assets, it lost its lead. Canopy Growth has to make sure they are selling products that the other companies don’t have. Also since the Marijuana is an upcoming market, focusing on getting curious/new customers should be a priority to make them become loyal consumers.
Suppliers- Canopy Growth has lot of suppliers which makes supplier power low due to Canopy’s ability to just switch suppliers. Due to high demand of the marijuana industry, suppliers have to be very reasonable with Canopy Growth in order to achieve profits, which also causes suppliers to have less power. Canopy Growth just needs to find the right suppliers that has low costs but due to its abundance of suppliers, using different suppliers shouldn’t be a problem.
Buyers- Having products that are unique from others should be a top priority for Canopy Growth because in this industry, having someone hooked on your products will get you more buyers. If a customer likes the product, they will buy it in bulk, because it’s marijuana, and it will make it harder for the customer to ever switch if the quality is top notch. Since the buyer will buy the products in bulk, prices shouldn’t be a problem due to the demand and quality. Canopy Growth should highly market and make sure it’s product are unique to build a large foundation of loyal customers. Doing so will provide a lot of sales and henceforth a profit.
New Entries- The threat of new entrants isn’t a big problem for Canopy Growth because the industry it’s in is a hard industry for new entrants to come in. This is due to the fact of the government heavily regulating laws for marijuana and the fact that Canopy Growth sells differentiated products instead of standardized products. If Canopy Growth keeps using it’s competitive advantage it has and keep having unique products, new entrants would have a lot of trouble competing against them.
Substitutions - A threat of substitutes would be the Illegal Marijuana Markets because if the prices are better there then customers would hesitate to get products from Canopy Growth. To stop that from being a big threat, Canopy Growth needs to make sure it’s products are great quality especially more then the illegal products, also having unique products that only Canopy Growth can produce, will make it harder for customers to find an alternative.