Bargaining power of suppliers in 2012, under armour's products were produced by 27 manufacturers located across 14 countries asia accounted for the largest proportion of products manufactured with 53% share. Bargaining power of buyers: under armour has built a great reputation over time through marketing campaigns and by sponsorship this has helped it acquire superior brand reputation. The bargaining power of nike's buyers is low to moderate the number of its competitors is not so small if not very large apart from adidas and under armour, there are other competitors like puma and reebok. This power is highest when buyers are able to gather together and amount for a large percentage of the producer's sales revenue or when there is a number of suppliers providing the same type of productin this article, we will look at 1) types of buyers, 2) bargaining power of buyers, 3) factors that determine the strength of buyers, 4.
Bargaining power of buyers: the more powerful a buyer is relative to the seller, the more influence the buyer has this influence can be used reduce the profits of the seller through a reduction of prices, increased favor in customer service or order delivery, or influence over who the seller supplies to. Bargaining power: nike this article was about the market power of nike based upon five forces these forces are competitive rivalry or competition (strong force), bargaining power of buyers or customers (moderate force), bargaining power of suppliers (weak force), threat of substitutes or substitution (moderate force), and threat of new entrants or new entry (weak force.
Bargaining power of suppliers: a diverse supplier base limits the company's bargaining power under armour's products are produced by dozens of manufacturers based in multiple countries. Bargaining power of suppliers - while no single supplier holds significant bargaining power, footwear production is concentrated in vietnam, china and indonesia nike's footwear and apparel products are manufactured by third-party contract manufacturers outside the us in various countries, including vietnam, china, indonesia, argentina, brazil, india and mexico. Bargaining power of nike's customers/buyers (moderate force) nike's customers directly affect business performance this element of the five forces analysis shows how consumers determine business competitiveness and the industry environment.
Bargaining power of end customers is lower as under armour enjoys strong brand recognition among them on account of innovative product portfolio and high quality products. The bargaining power of suppliers, one of the forces in porter's five forces industry analysis framework, is the mirror image of the bargaining power of buyers and refers to the pressure suppliers can put on companies by raising their prices, lowering their quality, or reducing the availability of their products. Porter's five forces model is a framework for industry analysis and business strategy development the five forces included in this model help determine the competitive intensity and therefore the attractiveness of a market.
Since nike has bargaining power not only over their supplier but their customer too, they are excessively strong in bargaining for their pricing and product the fact of high barrier of entry and no substitute product also make sure nike high profit in this industry. By definition, porter's five forces analyzes the competition in the industry, potential of new entrants to the industry, power of suppliers, power of customers and the threat of substitute products. The second of porter's five forces is what he calls the bargaining power of buyers if your principal customers have the upper hand, it may be difficult to forge a sustainable, competitive advantage.
See also: porter's five forces of competition threat of new entrants supplier power buyer bargaining power threat of substitutes complementors (sixth force) competition , competitors , costs , planning , pricing , strategy , wikicfo. The third force, the bargaining power of buyers, is also not strong there are two levels of buyers involved in the sneakers market the end consumer is one type of buyer. Relative to the number of firms in the industry there are a large number of buyers in the market with high bargaining power therefore in order to increase sales and market share, firms need to continuously market their product and differentiate their brands against competitors.