1. The Supply Chain

2. Supplier 1 Customer 1 Company X Customer 2 Supplier 2 Customer 3 Supplier 3 Customer and Buyer are synonyms

3. Jack woodsman Charley chair maker Village store Bill blacksmith Stinky glue maker Supply Chain circa 1850 A very short chain

4. Intel makes UPUs FutureShop Dell assembles computers Staples XYY custom cases Acme makes cables Bernard Liengme Intel as a supplier

5. ABC pure silicon Dell Intel makes UPUs Imperial Smelters pure gold Acer PolymersR-Us plastic case Toshiba Intel at the centre

6. Dell Small companies FutureShop sells high-tech Apple you Acer me FutureShop at the centre

7. Company X Supplier 1 Customer 1 X wants its Supplier 1 to charge low prices X wants its Customer 1 to pay high prices Supplier 1 wants customer X to pay high prices Customer 1 wants its supplier X to charge low prices Everyone wants to keep its Customers

8. Dell needs both of them Intel makes UPUs AMD makes UPUs Very specialized; the only suppliers Dell assembles computers Dell tells XYZ what to make. Dell might come to reply on XYZ XYY custom cases Acme makes cables Dell can replace Acme anytime it wants to Different types of relationships

9. When there is no choiceMonopoly • Legal: In Nova Scotia the restaurant business must buy it liquor from NSLC • Very specialized items: If ADM goes under, Inter will have a monopoly – see later about new comers • Business arrangement: Bentley cars are Rolls-Royce cars with more expensive bodywork. Bentley has one supplier of car chassis .