The first force in Porter's Five Forces Model is Entry Barriers. These factors are those that make it harder or easier for another company to enter into the industry. High barriers to entry will keep potential competitors out of the industry and low barriers to entry will give an opening for competitors to enter into the industry if the industry returns are high enough. (Hill & Jones 82) The fewer competitors in an industry the more the existing companies can take advantage of higher prices and better returns.

With typewriters, the printing is done through an inked ribbon that is fitted on spools, and travels with the operation of the machine. It then reverses automatically when one spool becomes completely unwound. Electronic typewriters are basically manual typewriters with the typing strokes powered by an electronic motor drive (www.britannica.com). Word processors use application programs for manipulating text-based documents. They are the electronic equivalent of the paper, pen, typewriter, eraser, dictionary and thesaurus. Depending on the program and the equipment in use, word processors can display documents either in text mode using highlighting, underlining, and color to represent italics, or boldfacing and other such formatting. In the graphics mode, fonts can appear on the screen as they will on the printed page. Some word processors can also check spelling, find synonyms, incorporate graphics created with another program, correctly align mathematical formulas, create and print letters, perform calculations, display documents in multiple on-screen windows, and also enable users to record macros that simplify difficult operations (www.msn.encarta.com). One major manufacturer of typewriters and word processors is Brother.

World Wide Web March 13, 2001, ZD NET http://www.zdnet.com/pcmag/stories/reviews/0,6755,2676495,00.html

The Personal Computer (PC) or desktop, is a machine capable of repetitively and quickly performing calculations and instructions. Its Design is to be used by a single person; a PC is smaller, less expensive and easier to use than other classes of computers, such as supercomputers, mainframe computers, or workstations. However, it usually has less computational power (www.msn.encarta.com). PC's can most likely be found within office environments, schools, and homes. Along with typewriters and word processors, their prices are far less than laptops as well.

IBM does set some standards for its suppliers however. Once suppliers enter into a contract with IBM, they must follow specific instructions given to them. These instructions include document requirements (eg: packaging list, billing invoices, etc.), packaging and labeling requirements, shipping instructions, and even country of origin marking (See Appendix A). IBM also has instructions for exports to IBM corporations in the United States (www.ibm.com).

IBM has numerous amounts of suppliers for their laptop computers. A major supplier is Intel, the world's largest manufacturer of microprocessors. The industry standard for computers runs on Intel's microprocessor family such as the Pentium series microprocessors. IBM has little choice but to use an Intel microprocessor for their laptops. Intel currently possesses about 85 percent of the market so they have supplier power over IBM. This puts Intel in a very powerful position in this situation. There are very few substitutes for Intel's microprocessor, so IBM has little choice but to deal with Intel. Intel has the ability to raise prices to any level that satisfies them. This level would not prevail in a highly competitive market for microprocessors (Hill & Jones, 2001).

The last of the forces in Porter's model is the intensity of competition. If the competition is low then the dominant company will be able to raise prices and earn greater profits. But when the competition is high like it is in the computer market then there is a price war where prices have to be competitive to your competitors or you will have low market share and smaller profits. (Hill & Jones 84)

Suppliers to IBM are also instructed to use IBM's global procurement system. With the use of Electronic Data Interchange (EDI), business transactions can easily flow electronically between IBM and suppliers. Through IBM's EDI services, "forms exchange" has now evolved. Suppliers can receive electronic purchase orders from IBM procurement and automatically generate an invoice from it. This metho

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