<!-- generated: provider=openrouter model=arcee-ai/trinity-large-preview:free date=2026-02-22 source=market-structure -->

# Platform Intermediary

## Definition

A company that controls the infrastructure through which supply chain
participants transact, without itself producing or consuming goods. Platform
intermediaries earn revenue from network access fees, transaction commissions,
data analytics, and financing services. Their market power derives from
network effects: value accrues to participants proportionally to the size
of the network, creating winner-take-most dynamics. Unlike traditional
intermediaries, platforms bear no inventory risk — that remains with
producers and carriers.

## Source

Market Structure in Modern Supply Chains, §Platform Intermediaries

## Supply Chain Domain

Market Structure

## VSM Assignment

S4 — Platform intermediaries function as the intelligence layer of the
supply chain, aggregating and intermediating market information across many
buyers and sellers simultaneously. They are not operational (S1) but shape
what operations are possible and at what price.

## WoN Concept

Merchant Capital — Smith's analysis of merchant capital — capital employed
to buy in one market and sell in another, earning profit from differential
access — maps closely to platform intermediaries. Both earn profit not
from production but from controlling access to exchange. Smith noted that
merchants are geographically mobile and have no necessary loyalty to any
particular productive system, giving them structural leverage over producers
who are fixed. Platform intermediaries exhibit the same dynamic at
unprecedented scale: the platform has no physical attachment, yet producers
who exit lose access to the entire buyer network.

## Modern Context

Platform intermediaries represent a structural innovation Smith could not
have anticipated: they capture the coordination function of merchant capital
while eliminating its inventory risk and capital requirements. The result is
a higher-leverage, lower-capital form of intermediation than Smith described,
but the underlying logic — control of the exchange infrastructure creates
extractable surplus — is precisely what he analysed.
