A supplier group would be most powerful when _________.
A) there are many suppliers
B) there are few substitute products
C) there is a low differentiation of products supplied
D) there is a high threat of backward integration by the buyers

Question

Quizplus · Accepted Answer

A supplier group will be powerful when the supplier group is dominated by a few companies and is more concentrated (few firms dominate the industry) than the industry it sells to; the supplier group is not obliged to contend with substitute products for sale to the industry; the supplier group products are differentiated or it has built up switching costs for the buyer; or the supplier group poses a credible threat of forward integration.

A Supplier Group Would Be Most Powerful When _________