This segment is more attractive and has high entry barriers and low exit barriers. Some new companies enter the industry and poorly performing companies easily exit the market. When barriers to entry and exit are high, the profit margin is also high, but businesses face more risk as poorly performing businesses stay put and fight. When these barriers are low, firms enter and exit the sector easily, and profits are low. The worst situation is that when barriers to entry are low and barriers to exit are high, then in good times companies enter and it becomes very difficult to exit in bad times. (www.notesdesk.com)3. Industrial RivalryIndustrial rivalry means the intensity of competition between existing competitors in the market. The intensity of the rivalry depends on the number of competitors and their capabilities. Industry rivalry is high when:• There are a small or equal number of competitors and fewer when there is an obvious market leader.• Customers have low switching costs• The industry is growing• Barriers to market output are high and competitors stay and compete • Fixed costs are high which results in huge production and reduction in