The bargaining power of an industry's buyers is greater when
A) the industry is consolidated and the buyers are many.
B) the buyers make small and infrequent purchases.
C) they can threaten to enter the industry and produce the product themselves.
D) buyers' switching costs are high.
E) it is not feasible for buyers to purchase inputs from more than one company in the industry.

Question

Quizplus · Accepted Answer

Buyers have greater bargaining power when they can threaten to enter the industry and produce the product themselves, as this poses a direct threat to the existing companies by potentially reducing their market share and sales.

The Bargaining Power of an Industry's Buyers Is Greater When