Buyer leverage

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Buyer leverage, in business, marketing, and strategic management, is the amount of bargaining power that buyers have when purchasing goods and services.

The amount of buyer leverage relative to the bargaining power and leverage of the seller depends on the information that seller and buyer have about the product, the relative scarcity or abundance of the product, the availability of product substitutes, and many other factors. The relative leverage of buyers and sellers determines the price and terms of transactions and the nature of business relationships.

For instance, business procurement managers often use their past purchase histories to get better deals from sellers vying for their business.

[edit] See also

• Porter 5 forces analysis