Effect of Supplier’s Market Power on Business Model Performance in B2B Market

Abstract

Business-to-business (B2B) enterprises, as the foundation of the national economy, are facing real growth opportunities but in lack of good theoretical guidance on business model. Business model study is a new research hotspot in both business circles and academic domain. Focusing on Industrial market, this paper studies the effect of supplier’s market power on business model performance. After interviewing experts and distributing questionnaires, the author discovered that the supplier’s market power has a positive influence on business model performance. Through structural equation modelling (SEM), it is revealed that competition environment and market position are the key components of supplier’s market power, and both components have positive effect on business model performance. At the same time, competition environment and market position also have positive effect on each other. The main contributions of this research are summarized as follows: Firstly, the introduction of competition environment and market position sheds new light on the research into market power in B2B market; Secondly, the proposed model of the supplier’s market power on business model performance lays the basis for scientific measurement of market power and its effect on business model performance; Finally, this research provides a good reference for enterprises to update their business strategy and model at the right time when the market power changes.