When price competition among rival sellers is a dominant competitive force
When the industry's product is a standard, commodity-type item readily available from a variety of sellers
When there are not many ways to achieve product differenciation that have value to the buyer
When most buyers use the product in the same ways and have much the same needs / requierements
When buyers incur low switching costs in changing from one seller to another and are prone to shop for the best price
When buyers are large and have significant bargaining power