Bargaing Power of Suppliers and Customers

In: Business and Management

Submitted By manjulstha74
Words 890
Pages 4
Bargaining Powers of the Suppliers:
The suppliers of the bank are basically the investors in the bank. Those suppliers of the bank are i. Promoters:
They are the pre-investor of the business house. They were the initial investors of the bank. Initially sunrise bank was a private limited bank, during that time promoters had very high bargaining power. In the past it was experienced that the bank had to work in accordance to the promoters. After the bank was open to the general public, the bargaining power of the promoters has diminished. Unlike in the past any actions taken by the promoters are now answerable to the general public. So the few major promoters themselves cannot take decision. So decisions should be taken in consideration of the equity owner of the bank.

ii. Shareholders:
They are the equity owner of the business. It was in recent times that the bank had opened its ownership to the general public. It was experienced that sunrise bank had the biggest share ratio in terms of capital. At present there are 80,000 shareholders of the bank. It was after the establishment of the bank that it had opened its share to the general public. Now, as the share ratio of sunrise bank is highest compared to other banks, the bargaining power of the shareholder can be taken high. Any decision taken should be approved by shareholders; in this context the bargaining power of the shareholder can be high. There is a provision that the shareholders nominate 2 people as their representative in the Board of Directives. In the BOD those 2 people represent the decision of the general public. Any suggestion or decision cannot be directly taken by the shareholders; those decisions need to be evaluated by the higher authority such as the CEO, promoters, and many more. In this regard the shareholders do not possess high bargaining authority.

iii. General Suppliers…...

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