Running head: A Horror Show at the Cinemaplex

Assignment 4: A Horror Show at the Cinemaplex

A Horror Show at the Cinemaplex
1. Perform a comprehensive analysis of the five (5) competitive forces. Discuss what level of competition can be anticipated amongst industry rivals. Among the 5 companies that own the majority of the theater, there is little difference in price or offerings. You don’t see ads saying come to our theater it is better that so and so company. As the text stated the theater that gets picked is usually paced on location.
A. Rivalry among existing competitors It does not really seem like there is a lot of completion between the theaters themselves. Most of the threat is from outside sources and the current way of doing business with the studios and advertisers.
B. Threat of new entrants
The main completion is going to come from Red Box, On Demand, and Netflix, not theaters among themselves. The low cost high quality home theaters systems are giving family’s the movie feel without the cost, or dealing with cell phone conversations, rude staff, and commercials’.
C. Bargaining Power of Suppliers The bigger megaplexes do have some bargaining power as far as concession items but they still sell their concession for the same price as the average for all theaters.
D. Bargaining Power of Buyers The theater is at the mercy of the studio and the consumer. There is money to made mainly in locations where going to the movie is the high light in your small town. The theaters have little buying or selling power in the current strategic set up.

E. Threat of substitute product or services
The rate moves are going to DVD and cable on Demand is an easy cheap way for people to see a movie without a big cut into the family budget. Many have big TV’s in their home so the home theater is a huge threat to the local movie house.