Which Porter's force addresses the bargaining power of suppliers?

• A. Bargaining power of suppliers
• B. Industry rivalry
• C. Bargaining power of buyers
• D. Threat of new entrants

Answer: (A)

In Porter’s framework, the force that looks at how much power suppliers have over prices, terms, and input quality is the bargaining power of suppliers. This force analyzes factors like the number of suppliers, how unique their inputs are, switching costs for buyers, and supplier concentration. When suppliers hold significant power, they can raise prices or impose harsher terms, squeezing margins for the firms in the industry.

The other forces describe different dynamics: industry rivalry assesses competition among current players; bargaining power of buyers examines how much buyers can push prices down or demand better terms; threat of new entrants considers barriers that could allow new firms to enter; and threat of substitutes looks at the pressure from alternative products.