ADR International warns purchasers to avoid forcing down prices paid to suppliers

from sourcewire.com

The increasing buying power of multi-national companies in a globalised world means procurement professionals will have to be more careful to avoid abusing the market, says ADR International CEO Robin Jackson.

In ADR International’s latest Business Briefing, Jackson says competition investigations in the past have usually focused on companies joining forces to fix prices to consumers. But increasingly, the focus is also on companies abusing their buying power to force down the prices they pay to suppliers. This is known as “monopsony”’, where buyers are dominant in the marketplace, the mirror image of the better known “monopoly” in which sellers are dominant.

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