Michael Porter’s five forces model gives a framework that models the global portable spectrometer market, which is influenced by five forces. The strategic business managers, trying to create an edge over competitive firms in the global portable spectrometer market, can utilize this model to better comprehend the industry connection in which their firm operates. The components of each of the forces and the degree of impact of each component in the context of the global portable spectrometer market have been broken down and analyzed.
FIGURE 5 Porter’s Five Forces Analysis of the Global Spectrometer Market
Source: MRFR Analysis
Threat of New Entrants
The global portable spectrometer market witnesses the presence of several established players from Asia, Europe, and the US. The initial cost required for establishing manufacturing facilities in the spectrometer is moderate. Furthermore, the cost of integrating/manufacturing the components with raw materials is less since the development of portable spectrometers is a discrete manufacturing process. Moreover, favorable government regulations supporting the standards and operability of spectrometers further lower the barriers of entry for the new players. New entrants are expected to pose a moderate threat to the existing players due to less potential in the African and South American regions.
Bargaining Power of Suppliers
There are many global and local players present in the spectrometer market, which include Agilent Inc, Thermo Fisher, Hitachi High Tech Corp, and Perkin Elmer. The raw materials required to produce electronic components have low differentiation as they are generally supplied by a fixed number of material suppliers globally. Owing to the presence of a large number of raw material suppliers outside Europe and South America, the manufacturers procure the material from outside the region. As a result, the bargaining power of suppliers becomes high. Furthermore, the cost of switching suppliers for the manufacturers is high due to a limited number of regional and local suppliers. Thus, the suppliers of the spectrometer market are expected to have high bargaining power during the forecast period.
Threat of Substitutes
Currently, portable spectrometers are being highly utilized across various industries such as pharmaceuticals, healthcare, chemicals, and research. The wide scope of portable spectrometers for various forensics, medical, and life sciences applications is likely to fuel their adoption during the forecast period. The portable spectrometers can be easily replaced by bench-top or traditional spectrometers that use UV, X-Ray, or infrared technologies. These alternatives are likely to create a certain amount of threat in the global portable spectrometer market. However, these alternatives are heavy and cannot be carried to areas where on-site analysis of compounds is required. Thus, the threat of substitutes is likely to be moderate in the upcoming years.
Bargaining Power of Buyers
The buyers in the spectrometer market comprise distributors and end-use industries such as pharmaceuticals, chemicals, life science, academic research, and clinical research. Since most of the suppliers are established outside North America and Europe, the local and regional distributors hold low power over the prices. Furthermore, the developing countries do not have highly mature end-use industries, and the technical expertise of the manufacturers is less. This further increases the cost of switching from one supplier to another. Since the buyers of spectrometers rely mostly on global players, brand loyalty is moderate. Therefore, the bargaining power of the buyers is expected to be low during the forecast period.
Rivalry
The players in the global portable spectrometer market are expected to witness a moderate degree of rivalry during the forecast period. The existing players in the portable spectrometer market highly focus on the operability, accessibility, accuracy, and reliability of these spectrometers. This increases the rivalry among the existing players in the market. However, low switching costs between devices, moderate brand loyalty among consumers limits the rivalry among these players. Furthermore, the limited presence of local players in the market makes the rivalry moderate.
