Is to provide top quality, affordable housing to lower-income consumers, enhancing lifestyle and building life-long brand loyal customer segments to the Ikea brand name. This is accomplished utilising high quality assembly products and utilising the fine interior home products from trusted Ikea.BoKlok housing maintains a very long product life cycle, thus the ability for Ikea Estates to compete with reputable housing contractor companies in the United Kingdom is feasible and probable based on lower-cost pricing structures. Having research data that creates accurate profiles of desired target markets will assist in developing an appropriate methodology for entering the UK market.Thompson, Gamble and Strickland (2005) describes the model proposed by Michael Porter indicating five distinct forces in the external market that can drive business success or failure. These include threats of substitutes, buyer control in the market, supplier power, competitive rivalry and threat of new entrants.The threat of substitutes is significant, as the pre-fabricated housing market is well-established in the United Kingdom. There is already an identified lower-income target market for similar high quality, more affordable pre-constructed modular homes. These houses begin at around £37,500 and range to £60,000 depending on size and volume of bedrooms (The Independent 2005). Since the aforementioned pre-manufactured homes cater to similar target markets as those being sought by BoKlok and are priced in-line with Ikea’s pricing model, the existence of pre-fab competitors represents a significant threat in attempting to outperform their existing brands and reputations for quality.There is little buying power held by consumers, even though pre-fabricated homes have a foothold in the United Kingdom. Switching costs for buyers are relatively high due to the extent of the financial investment (it is not feasible to change home suppliers after signing high-cost contracts for construction or set-up). There are only a handful of competitors providing pre-fabricated homes that fall within the same pricing structure as those from Ikea Estates. Though these manufacturers, such as Huf Haus, maintain recognised brands in this market environment, limited availability of potential suppliers reduces the amount of power consumers can exert upon market entry.Supplier power is also reduced with Ikea’s strong purchasing power established within its international supply
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