-THREAT OF NEW ENTRANTS

BY: SHARON DMELLO----12 SHYAN KASHYAP----20 ANKITA VASANDANI-----57 KRITIKA JAVERI----58 RUCHI GOYAL -----59

FACTS OF THREATS OF NEW ENTRANTS

Threats of New Entrants is Low as startup and Manufacturing Costs are High 2. The monopoly held by top 5 firms American National Can, Continental Can, Reynolds Metals, Crown Cork & Seal and Ball Corporation aggregate 61% market share in the U.S. metal can industry in 1989. Difficult for a small startup firm to have any real significant impact on obtaining market share unless they come in on a large scale or if they have proprietary know-how.
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3. In the 1970s and 1980s there were number of corporate diversifications and subsequent consolidations because of low profit margins, excess capacity and rising material and labor costs. This kind of environment was not feasible for new firms to enter into the market.

4. There was little growth potential for metal cans in the 1990s. Plastic was forecasted as the growth segment for containers. Emergence of plastic as a viable packaging material thus, posed a challenge to new entrants.
5. The continuing threat of in-house manufacture. Inhouse manufacturers enjoyed high-volume, single-label production runs and economies of scale which threatened the can manufacturing industry.

6. Highly specialized equipment required in this industry. (Because can manufacturing was new to many regions of the world, Crown Corks older equipments met the needs of what was still a developing industry overseas. However, now the new entrants would require highly specialized equipments.)

7. Before Connelly took control, the company had generated very high production and transportation costs. It was only because of John Connellys emphasis on quality, flexibility and quick response to customer needs that the company became well established. 8. Also, the focus and efficiency that John Connellys leadership showed, in order to make Crown Cork & Seal achieve sustainable success may not be present in every firm planning to enter the market.

THREATS OF NEW ENTRANTS

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Threats of New Entrants is Low as startup and Manufacturing Costs are High Price Competition Oligopoly Market Five Firms (61%) Industry is controlled only by few Industrialists.

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