Fast Food Industry: Bargaining Power of Suppliers

Business-to-business and the fast food industry supplier bargaining power varies significantly across time and location. A fast food business in a specific provider, supplier bargaining power key role in both the availability of other suppliers.

Brand Name

• Brand-name suppliers tend to have more bargaining power. For example, McDonald's and Coca-Cola have contracts with Newman's Own brand to attract loyal customers using this brand name. They supply the restaurant, the restaurant may lose money or be forced to change their marketing strategies because suppliers, have more bargaining power.

Availability of other suppliers

• a market saturated with the same or similar products, suppliers, a separate supplier's bargaining power decreases. Restaurants are only offering the same products can switch to another supplier. These suppliers to meet the needs of consumers may be more, and customers, reduce costs, provide better products, reduce delivery time, or you can put pressure on suppliers to provide high volume.

Cost and quality issues

• significantly reduced price than other supplier offers a product that a supplier, even in a saturated market, have more bargaining power. A supplier of a superior product, offers better efficiency or faster delivery time Similarly, the supplier's bargaining power will be higher than other suppliers in the industry. Fast food restaurants in high-volume, low-cost supply of the rapid replacement of the restaurant at the time, can save you money and hassle. A supplier is the cheapest, most efficient or provides the highest quality of items, it has more bargaining power.

Business is part of the supplier

• Agreement on a supplier's willingness - and the risk of losing a client - part of its business to a certain fast food comes from, as well as the budget is based on the supplier. A rich, diverse client base with a supplier who relies only on one or two restaurants have bargaining power over suppliers.