It is primarily related to the
power of suppliers have to
raise their prices
Power will be higher
where there are few
suppliers
Power will bw also higher where
there are significant switching costs
associated with moving to another
supplier
Bargaining Power of
Buyers
Number of Customers
Size of Customers and
size of orders
Differences between competitors
Price Sensitivity
Switching Costs
It is related to Customer ability to force
prices down or get improved product
quality
It also will be higher when customers
are few and concentrated and when
the offering is undifferentiated
We are talking about Strategic analysis and the Model can be also used for the
Positioning Approach strategy. The Model is used in order to analyse the
ATTRACTIVENESS of the industry. So that we are in the Micro Enviroment of a chosen Market.