The market power of suppliers is an important factor. Suppliers of raw materials, components, labor and services may affect the company. Suppliers may refuse to work with the company or, for example, to set excessively high prices for unique resources (Faulkner, 1997). The factors to consider here are:
comparing the cost of switching suppliers and the cost of switching companies leads to the inference that expenses are high
degree of differentiation of raw materials is low
availability of substitutes suppliers is low
comparison of the concentration and the concentration of suppliers is low
solidarity of labor is high (eg activities of trade unions)
threat of forward integration of suppliers may affect the company’s ability to integrate back
comparing the cost of raw materials and raw materials and the selling price of product suggests that prices will need to be increased.