MPC Relationship With Its Large Global Customers Case Study

MPC Relationship With Its Large Global Customers - Case Study Example Moreover certain value-added services that were provided to the clients which helped in improving and bolstering its relationship with the clients. The relationship between the suppliers and the clients is guided by the bargaining power of the supplier/the buyer. The supplier dictates the shots if it has a higher bargaining power and conversely, the client has an upper hand when it has a higher bargaining power. In this case, there are only a few players I the market. Moreover, with high entry costs, the entry of new players is quite difficult. This gives MPC a higher bargaining power. The bargaining power also defines the value division. The bargaining of the supplier with the client the amount the supplier gets for providing its clients with the important resources. The figure above depicts the relationship between the client and the supplier using a line segment. The top level of the line represents the value that has been received by the buyer. This value is equal to the willingness of the buyer to pay for the goods or services minus the amount that has been paid by the organization. The middle segment represents the value that has been captured by the firm. The lowermost position of the segment defines the value that has been acquired by the supplier. (Brandenburger M, Stuart HW, n.d.). The figure above gives a model on how suppliers should rate its clients. MPC must use the model stated in the figure to analyze its relationship with the clients. It should divide its clients on the basis of relative value and its attractiveness. MPC can also use its rapport with its clients to set up bases in the low-cost destinations. This would allow the company to make its presence in those markets while creating entry barriers for the new players. This would also give MPC a foothold in a new and emerging market. The firm can employ the model of Brandenburger and Stuart for creating new value in their product offering. This model is based on the concepts of value  creation and added value which represents the size of the profit to be shared and how to share that profit respectively.