Best Practices to Reduce Supplier Power Asymmetries for Microbusinesses

Buyer and supplier power dynamics can have immense effects on the outcomes of transactions and relationships. These effects can make or break a business, and thus, knowing how to manage them is essential to healthy business operations. This knowledge is particularly important for microbusinesses, defined as having 1-4 employees including the owner, because they inherently exhibit many of the attributes associated with the weaker player in buyer-supplier dynamics. In order to overcome the negative consequences that come with being the weaker player in a relationship, a microbusiness often has to work harder than other firms in the hope of securing favorable supply. Unfortunately, existing literature focuses on organizations that are larger than micro, or even small-sized firms, thus our understanding about the effect of the buyer-supplier relationship on a microbusiness is rather limited. Even less is our understanding about the strategies that a microbusiness can use to navigate unfavorable buyer-supplier power dynamics. The purpose of this thesis is to fill this gap, exploring power dynamics for microbusinesses and assessing if and how existing research can be applied to these unique entities. Using an established sociological framework, this thesis suggests some power balancing methods that microbusinesses can use to improve their position in their supply chain relationships to extract maximum value from their supplier relationships. This thesis aims to provide practical actions for microbusiness abundant in Portland and beyond