Threat of New Competitors Barriers to new competitors discourage new competitors from entering the market and create more competition for established companies. Profitable markets attract new entrants, which erodes profitability, unless incumbents have strong and durable barriers to entry. There are several important barriers to entry, including economies of scale, capital requirements and product differentiation, switching costs, and government policy. Regarding our Eco Powered engines, the most crucial barrier to entering this business is patent protection. In China there are 3 forms of patent protection which include invention patent, design patent and utility model patent. By using the patent for invention, the EPE would impose 20-year patent protection. The EPE would ask for the right to be granted for a fixed period with a minimum of 20 years for the protection of the invention. This would reduce or eliminate competition with potential and existing businesses that would pose a threat to new competitors. The methods used in production, production materials, etc. are included in patent protection. Another major barrier to entry is the capital requirement to start a new business like Eco Powered Engines, which includes the cost of building or purchasing facilities and equipment and building inventories. Furthermore, product differentiation would also be a problem for new companies because our company would have already marketed our product and would have a number of loyal customers. Any new one would have to spend a lot of money to get their name known and would have to convince the customer to start buying their engine. Another big problem for new businesses to compete is the distribution of their products. This is a new industry that gets product distribution... middle of paper... very profitable in the long run. RIVALRY AMONG EXISTING COMPETITORS The degree of rivalry or intensity of competition is the final force for the EPE five forces theory. This point is crucial to evaluate the completion existing among current companies in the sector. Although EPE produces a unique type of automotive diesel engine, there are other manufacturers that compete based on product type. Existing competitors include: Anhui Quanchai Co. ltd (manufacturer and distributor of diesel engines) and Hebei Energetic-Ox Motor Group (enterprise consisting of 12 subsidiaries. Their main products include: electric motors, automotive oils and filters. Although competitors exist in In the competitive industry, EPE offers product quality guarantees, price guarantees based on protection, environmentally friendly materials, components and processes.