The bargaining leverage of suppliers is greater when
A)the suppliers' products/services account for a small percentage of industry members' costs.
B)industry members incur low costs in switching their purchases from one supplier to another.
C)industry members account for a big fraction of supplier's sales.
D)there is extensive seller-supplier collaboration.
E)the supplier industry is composed of a large number of relatively small suppliers.

Question

Quizplus · Accepted Answer

When suppliers' products/services account for a small percentage of industry members' costs, suppliers have more leverage because the cost impact on the industry is minimal, making it easier for suppliers to demand higher prices or better terms.

The Bargaining Leverage of Suppliers Is Greater When