Question

Five Forces Analysis question about IMAX: Please discuss- What are the bargaining power of IMAX's suppliers and buyers?

Answer 1

Bargaining power of Supplier's for IMAX

1. The supplier's which provide content and service to IMAX, their quantity is huge and a lot of similar type of suppliers are available so that the company can easily switch from one supplier to another. This makes the supplier power weaker.
2. The suppliers do not provide any other content other than the IMAX requirement and this makes the products unsubstitutable and increases the power of supplier
3. As the suppliers are product specific it is a huge disadvantage for IMAX as they can always negotiate and extract higher money from IMAX

Bargaining power of the buyer

1. Very few firms produce product comparable to IMAX. Hence customers have less option to switch which makes the bargaining power of buyer weaker
2. When the buyer is price sensitive they will always go for a cheaper product and this increases the competition for IMAX in the market

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