Dinesh owns a restaurant. He is able to negotiate lower prices than other restaurants pay with his supplier because he buys in volume and threatens to buy from another supplier. Dinesh is:
A)trying to gain market share in the input market.
B)operating in a highly competitive market.
C)operating at a disadvantage compared to other restaurants.
D)exercising bargaining power.

Question

Quizplus · Accepted Answer

Dinesh is exercising bargaining power by negotiating lower prices than other restaurants pay with his supplier by buying in volume and threatening to buy from another supplier. This shows that Dinesh has the ability to influence the supplier's decision-making process and the ability to exercise their own interests.

Dinesh Owns a Restaurant