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| Topic: |
Business
|
| Number of pages / Number of words: |
19 / 5049 |
Essay's paper body
The strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates.
BARGAINING POWER OF THE BUYERS
The power of buyers describes the impact customers have on an industry.
Yes No
Are there a large number of buyers relative to the number of firms in the industry? x
Do you have a large number of customers, each with relatively small purchases? x
Does the customer face any significant cost in switching suppliers? x
Does the buyer need a lot of information? x
Is the buyer aware of the need for additional information? x
Is there anything that prevents your customers from taking your function in house? x
Your customers are not highly sensitive to price...
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x
Your product is unique to some degree or has accepted branding. x
Your customer's business is profitable. x
You provide incentives to the decision makers. x
BARGAINING POWER OF BUYERS IS HIGH
Buyers have a high bargaining leverage because the cost of switching to other brands is low or none. Buyers are also less sensitive to quality as the companies have similar products...
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