This pressure is most evident in FedEx's relationship with large corporate clients. These buyers have a great deal of bargaining power attributable to the large volume purchases they make. Negligible switching costs also contribute to buyers bargaining ability in the market.
Buyers have a great deal of bargaining power because of the large volume of purchases they make from FedEx... displayed 300 characters
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The purchasers of large volumes contribute significantly to the bottom line of businesses. For example, FedEx gained a lion's share of the catalog business because of their ability to offer these buyers lower prices than UPS.
Buyer group is powerful if it faces few switching costs. This competitive force definitely constrains FedEx... displayed next 300 characters
The price of a FedEx overnight letter is $11 compared to UPS and DHL prices of $12 and $13 respectively.
As FedEx management's policy is to maximize profits, they use the cutthroat business technique by pricing their services at high prices and hoping the consumer will use it based on the company's reputation and their unique and detailed tracking system...
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