The power of each supplier depends on:
A) Low concentration
B) Its commodity-like product
C) Relative importance of purchases
D) Its inability to integrate forward

Question

Quizplus · Accepted Answer

The power of a supplier depends on the relative importance of the purchases made by the buyer. If the supplier's product is critical to the buyer's operations, the supplier will have more power. Therefore, option C is the best choice. Option A is incorrect because a low concentration of suppliers means that there are fewer suppliers in the market, which could result in more power for individual suppliers. Option B is incorrect because a commodity-like product means that the product is not unique, which could reduce the supplier's power. Option D is incorrect because if a supplier can integrate forward, it could reduce the power of buyers, but it does not necessarily mean that the supplier has more power.

The Power of Each Supplier Depends On