Which of the following situations would increase a buyer's bargaining power?
A.
Their spend is a high proportion of a supplier’s revenue
B.
The buyer’s requirement is urgent and cannot be postponed
C.
There are many buyers in the market for the same goods or services
D.
There are few substitute products or services to the requirement
The Answer Is:
A
This question includes an explanation.
Explanation:
When a buyer’s purchase represents asignificant portion of a supplier’s revenue, it increases the buyer’s leverage. The supplier has a vested interest in maintaining the relationship and is more likely to make concessions to preserve the account.
“Buyer power increases when the buyer represents a large portion of the supplier's total sales. This dependency increases the buyer’s ability to influence terms.”