Industry Analysis
Porter’s Five Forces
• Competitive intensity within the industry o Compared to nationally owned pizza restaurants rivalry is high. o Compared to locally owned restaurants rivalry is high.

• Threat of new entrants o Threat of new entrants from nationally owned pizza restaurants is high because they have the capital to open multiple units. o Threat of new entrants locally is low because of the high cost involved to open a new pizza restaurant.

• Threat of substitutes o There are many choices for consumers to purchase pizza from locally owned to national chains therefore the threat of substitutes is high.

• Bargaining power of buyers o With the multiple outlets available for consumers the bargaining power of buyers is high because if prices are too high they will shop elsewhere. o Additionally, many consumers switch between pizza restaurants because they choose the outlet with the best coupon.

• Bargaining power of suppliers o The bargaining power of suppliers is low for the nationally owned pizza restaurants so they can demand lower prices. o The bargaining power of suppliers for locally owned pizza restaurants is high because they do not buy in large quantities.

• All things considered, Porter‟s Five Forces are high so the industry may not be as profitable or attractive.

However, in any case, the techniques implemented by successful, market players after provide them with an opportunity to leverage their business processes and compete favorably in the business. Since the establishment of Papa John's International, the company has grown up from a small pizza shop selling Pizza to tavern's customers to an international establishment having franchisees in key international arena. All this are as a result of well though differentiation strategy, thanks to the visionary leadership of John Schnatter.
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