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Competitive Rivalry in Rental Housing Research Paper

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Updated: May 10th, 2022

Wilma Baker

Wilma Baker specializes in renting homes and apartments to visitors in Santa Fe, New Mexico. The seasons for her business activity are summer and fall.

According to Last (2015), there exists a large number of providers of rental housing in the city of Santa Fe. In addition, it is stated that “there are at least 576 short-term rental properties operating in Santa Fe without a license” (Last, 2015, para. 22). The presence of businesspeople dealing in both long-term and short-term rental housing means that the relative power of a single entrepreneur is reduced.

Likely, the quality of housing that Wilma Baker offers does not differ significantly from that of her competitors. No matter what quality housing she offers, the rivals are likely to be able to propose housing of similar quality. In addition, there is virtually no customer loyalty in her industry (it is also a Competitive Rivalry factor (“Porter’s Five Forces,” n. d.)), for clients are visitors and tourists, most of whom do not return to Santa Fe often.

Therefore, it is possible to state that Wilma Baker has low power relative to her rivals.

Jerry Barker

Jerry Barker operates in Whistler, British Columbia. He rents condominiums to skiers and other visitors of a local resort. The business is seasonal; the main season is winter.

Jang (2013) asserts that numerous visitors come to Whistler during the tourist seasons and that the book most of the rented housing that is available in the small resort town. It is also possible to suppose that the quantity of housing available for rent is not great and that Jerry Barker does not have too many rivals in the town. The fact that there is a lack of rented condominiums means that customers will not have many options to choose from before they can decide not to rent housing from Jerry Barker. If this supposition is correct, this provides the businessman with a relative advantage in the competitive rivalry field.

If there are tourists who regularly visit the resort, they may also remember which organization they rent their housing from during their previous visits, so they may choose Jerry Barker’s firm if they liked it. This may provide the businessman with a certain amount of customer loyalty if the housing he provides offers a balance between the quality and the price that is relatively good in comparison to that of his rivals.

Therefore, it is possible to assert that Jerry Barker has a moderate or high strength according to the Competitive Rivalry analysis.

Chris Bickel

Chris Bickel, who lives in Chatham, MA, provides rented accommodation (homes and condominiums) to people who go on vacation on Cape Cod. The busiest season is summer.

According to Adams (2012), there has been a significant increase in the number of booked houses on the island of Cape Cod, and that a large part of the offered rental houses was booked by April 2012. However, it appears that quite a large number of providers of rent housing operated on the isle.

Some customers rent housing for the time of their vacations and then decide to rent the same housing in the future (Adams, 2012). Therefore, it is possible to state that the customer loyalty factor is present.

If we suppose that the situation remained more or less constant since 2012, it is possible to say that Chris Bickel has a moderate strength according to the Competitive Rivalry force analysis.

Comparison

According to our analysis, it is apparent that Wilma Baker has the lowest relative power in comparison to her rivals; these rivals are numerous, and she has no factors such as the loyalty of the customers helping her. On the other hand, Chris Bickel seems to have a moderate strength; he has client loyalty, but the number of competing housing providers is large. Finally, Jerry Barker appears to have the strongest position, because the quantity of rivals is not great, and he may also have loyal customers.

References

Adams, S. (2012). Hot market for summer rentals on South Shore, Cape Cod. Web.

Jang, B. (2013). . Web.

Last, T. S. (2015). . Web.

. (n.d.). Web.

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