Porter’s five forces:

1. Threat of entrants:

I calculated only two factors which are favorable to the industry and ten factors which are

unfavorable. It shows that there are low barriers to enter or even exit from industry is negative

point for the industry. Policies should be made according to the situation and for the safety of not

only business but also for the people. Increase in security measures will lead to health business

competition and more profitable who are in the business.

2. Bargaining Power of buyers:

Fireworks buyers have high bargaining powers. Which means that they are quite reluctant to

high prices. This feature is not attractive to fireworks industry.

3. Threats of substitute:

In fireworks industry threats of substitute is quite low because Chinese people relate firework to

religious as well as for social events. It’s like an important part of their lives. A larger number of

customer are still reluctant to adopt new products.

4. Bargaining power of suppliers:

Bargaining power of supplier are quite low because nothing more or less all are providing the

same things to their manufactures and if one try to increase price their customers will easily shift

to another supplier.

5. Determinants of rivalry among existing competitors:

Rivalry among existing competitors are relatively high. They are competing on the prices and cut

throat competition is already existing between the firms.

Key Success Factors:

1. Legality, on safety of workers and new entrants must be increased so healthy competition

grow between firms rather than they compete on prices.

2. Brand, firms need to create brands for a better image of the company and brad loyalty

3. Product Variety, all firms are playing on product diversification not on product variety

they need to create variety in product.

4. Safety Standards, are low in the industry we need to improve those standards for better

image of the product which is good for the workers as well as for the customers.

5. Low cost to premium, when companies will improve quality of the product they can

charge higher which will not even help to differentiate their product but profit margins as

well.

6. R & D, firms needs to spent more money on R&D so that they can effeminate their

product from others like some work has be done on environment friendly fireworks

which is overcoming the effects of environment pollution.

7. Skilled Labor, most of the labor in the industry is unskilled by giving proper training we

can create good skill among the workers which will help them more efficient work and

product.