The threat of entry is part of Porter’s Five Forces model that analyses and isolates the five competitive forces that shape most industries and determines an industry’s strengths and weaknesses. Substitute products or services that can be used instead of what you offer to pose a threat. The quicker and lower the costs for a rival to enter a market and be an effective competitor, the more your position could be weakened. An industry with a solid barrier to entry is perfect for existing companies within the industry. You will be able to charge the price you wish and the terms you want.