When buyers are in a weak bargaining position, companies in the industry must lower their prices to increase profits.

Question

Quizplus · Accepted Answer

When buyers are in a weak bargaining position, companies in the industry can actually increase prices and still maintain their profits. This is because the buyers have less negotiating power and are therefore more likely to accept higher prices. On the other hand, if the buyers are in a strong bargaining position, companies may have to lower their prices to remain competitive and attract customers.

When Buyers Are in a Weak Bargaining Position, Companies in the Industry