Porter’s 5 Forces Analysis – Top Glove

Low Threat of High Bargaining power

Substitutes
• Threat of substitutes is low
due to low rubber glove
cost, making no incentives
for buyers to find
alternative products
Low Threat of
New Entrants
• High barrier for entry due to
economies of scale by
incumbents
• New entrant has to invest
heavily into technologies &
equipment
of Customers
• Bargaining power of buyers is high
due to high reliance on major
MNCs/Multinational healthcare
corporates
• Easy to switch their orders from
manufacturer to manufacturer
High Bargaining
power of Suppliers
High Competitive
• High bargaining power
Rivalry of suppliers
• Local manufacturers compete aggressively • Glove industry
to achieve better economies of scales – depends on natural
adding new capacity rubber supplies
• Threats from neighboring countries eg • Few suppliers & they
Thailand & Indonesia – abundant domestic can easily switch
latex supply and cheap labor supply buyers