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Supplier Analysis Three areas are scrutinized to determine the bargaining power of suppliers. The suppliers include both manufacturers and wholesalers of the merchandises we carry, namely, books, audio-visual materials and educational toys/crafts. First of all, switching costs are low for the suppliers given that ‘hopscotch’ is a small start-up with low brand identity and awareness in the market. On the contrary, switching cost for ‘hopscotch’ is relatively high inasmuch as the niche market ‘hopscotch’ will be focusing on. This is especially true for the audio-visual category given the fact that some suppliers are exclusive and well-established, e.g. ‘Leapfrog’. Order size is another key determinant of the bargaining power. ‘Hopscotch’ has to start with low order volume due to the budget constraint while well-known suppliers typically look for high volume orders. Hopscotch may thus lose opportunity to source merchandise at discounted price that is only available for high volume purchasers. Nevertheless, costs can be passed on to customers because high price is sustainable with the high-end market position.
Approximate Word count = 624
Approximate Pages = 2.5
(250 words per page double spaced)
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