5 The directors of Blaina Packaging Co (BPC), a well-established manufacturer of cardboard boxes, are currently considering whether to enter the cardboard tube market. Cardboard tubes are purchased by customers whose products are wound around tubes of various sizes ranging from large tubes on which carpets are wound, to small tubes around which films and paper products are wound. The cardboard tubes are usually purchased in very large quantities by customers. On average, the cardboard tubes comprise between 1% and 2% of the total cost of the customers’ finished product. The directors have gathered the following information: (1) The cardboard tubes are manufactured on machines which vary in size and speed. The lowest cost machine is priced at $30,000 and requires only one operative for its operation. A one-day training course is required in order that an unskilled person can then operate such a machine in an efficient and effective manner. (2) The cardboard tubes are made from specially formulated paper which, at times during recent years, has been in short supply. (3) At present, four major manufacturers of cardboard tubes have an aggregate market share of 80%. The current market leader has a 26% market share. The market shares of the other three major manufacturers, one of which is JOL Co, are equal in size. The product ranges offered by the four major manufacturers are similar in terms of size and quality. The market has grown by 2% per annum during recent years. (4) A recent report on the activities of a foreign-based multinational company revealed that consideration was being given to expanding operations in their packaging division overseas. The division possesses large-scale automated machinery for the manufacture of cardboard tubes of any size. (5) Another company, Plastic Tubes Co (PTC) produces a narrow, but increasing, range of plastic tubes which are capable of housing small products such as film and paper-based products. At present, these tubes are on average 30% more expensive than the equivalent sized cardboard tubes sold in the marketplace. Required: (a) Using Porter’s five forces model, assess the attractiveness of the option to enter the market for cardboard tubes as a performance improvement strategy for BPC. (10 marks)