Bargaining Power Of Buyers Marketing Essay

Bargaining Power Of Buyers Marketing Essay For all kind of strategic decision making it is essential to consider number of internal and external factors so that a company can completely understand its position in strategic group it lies and which could assist the brand to device strategies which could lead the company towards the achievement of it strategic objectives in the light of it’s vision and mission statement, following is the graphical representation of the Porter’s five forces model and detailed explanation of ikea’s and h http://software–porter-five-forces.smartcode.com/images/sshots/software__porter_five_forces_18378.gif BARGAINING POWER OF BUYERS: IKEA: IKEA being a giant organisation and genuinely very cost effective which ultimately reflects on its pricing strategy, that leaves the buyer with a very low or nil bargaining power Ikeas standardised approach has always made IKEA out list the competitors which leaves the consumer very little choice to consider an alternative for the prod ucts and services being offered at IKEA. H Although the production is subcontracted to different countries but IKEA has got a complete grip on its operation overseas and has a robust control and management system to stay in bargaining position with its suppliers, due to bid system adopted by IKEA the suppliers all over the world finding themselves lucky to relate to the brand always try their level best to win the bid to get a chance to produce for the market leader in furniture industry which leave the suppliers almost with no power to bargain at any occasion H 70% of the suppliers are from Asia e.g. India etc who are finding themselves in a very good scale of performance on their own records as due to H&M growing strategy to expand has resulted in more merchandise to be prepared all the time with the growing tendency of 15-20% every year, therefore suppliers in this time of utmost recession are lucky to be associated to a brand which in this era of downsizing have expansion plans which would fetch more opportunities that could be availed by thousands of more suppliers bring them don to stage where none of the suppliers have any bargaining power