<p style="text-align: justify;">Allstate is one of the insurance companies doing business in the United States and Canada. It is founded in 1931. Thomas J. Wilson is the CEO of the company. The company is a public listed company and listed on the New York Stock Exchange. The Headquarter of the company is in Northbrook, U.S. It is one of the largest public listed companies. The main products of the company are Auto, Home, Life, Motorcycle, Renters, Boat, Landlord, Condo, Off-road vehicle, &; Business Insurance Retirement &; Investment products. [1] [2]</p>
<h1 style="text-align: justify;">Allstate &#8211; Porter’s Five Forces Analysis</h1>
<h2 style="text-align: justify;">Allstate &#8211; Threats of New Entrants</h2>
<p style="text-align: justify;">One of the most common barriers in the economy of the USA is economies of scale. As the USA is one of the largest consumer markets with more than 325 million of the population. To serve all of them is not an easy task, in terms of business, competition, finance, and scale. There is large population, and to serve them, there are the number of insurance companies already exist in the market. As the insurance company provides financial assistance, reimbursement to the insurers, it means that the company needs a large pool of finance not only to start the business but also for running its operations. Similarly, the USA is one of the most complex economies when we are concerned about doing business in an economy.<br />
There are different policies, rules, and regulations for every industry of the economy. The same is the case for the insurance company. Taking approvals and long complex procedures to follow put effects on aspirants. As customers are willing to secure themselves, they always prefer well established, financially sound and those companies which are most familiar to them. So, customer preferences are also one of the barriers in this market. Therefore, all of these facts show that this industry is well established, and threats of new entrants are low here.</p>
<h2 style="text-align: justify;">Allstate &#8211; Threats of Substitute</h2>
<p style="text-align: justify;">In the financial services industries, there are many businesses such as banks, insurance companies, etc. doing operations in the market, to serve the customer’s financial needs, to provide secure future, to provide a return on their saving and many other factors. Similarly, the government is also playing its role to serve the population. There are several different products which are offered in the market. When we talk about the insurance industry, health insurance, car insurance, house insurance and many other types of insurances are provided to the customer. Different businesses provide the same type of insurance to the market. Today’s customer has the choice to select among different options. Therefore, all of these factors tell us that threats of substitute exist in this industry.</p>
<h2 style="text-align: justify;">Allstate &#8211; Bargaining Power of Buyer</h2>
<p style="text-align: justify;">As there are a large number of customers in the market including businesses and individuals. There are several companies offering insurance to the market. The government is also providing services in the market. There is competition in the market, which pressurizes the companies to provide more value than others. Switching cost is low for buyers, as a buyer has to choose among the available options in the market and did not cost him much to move from one company to another. Therefore, it shows that bargaining power buyers is high in this industry.</p>
<h2 style="text-align: justify;">Allstate &#8211; Bargaining Power of Supplier</h2>
<p style="text-align: justify;">As the companies relay on different resources to run its operations. Different suppliers provide them these resources. Let’s talk about the marketing department, it is one of the most important departments in the company to create brand awareness. Different campaigns, agents, and event s are organized by companies to capture the market. As the number of companies is doing business in the industry, most of them buy supplies from the third party. It means suppliers have various options, it shows moderate authority in suppliers&#8217; end. Therefore, in this industry, various companies relay on supplies which shows that there is a moderate level of bargaining power of supplier exist in this market.</p>
<h2 style="text-align: justify;">Allstate &#8211; Competitive Rivalry</h2>
<p style="text-align: justify;">This is one of the established industries in the market, where several companies are looking for customers. As the switching cost for the buyer is low, which can affect the profitability of the company. So, companies always use different methods such as agents, marketing, and events to capture more potential from the market. Similarly, the companies are pressurized to lower the cost, if they don’t buyers may switch to other company’s products. All of these factors show that competitive rivalry exists in the market.</p>
<h2 style="text-align: justify;">References</h2>
<p style="text-align: left;">1 ALLSTATE, 2019, about company, [online], Available at: https://ourstory.allstate.com/?_ga=2.90672601.2144831385.1576164433-1090268960.1576164433<br />
2 Forbes, 2019, The World’s Largest Public Companies, [online], Available at: https://www.forbes.com/global2000/list/#tab:overall</p>