PPT

1. Business Markets

2. What is Organizational Buying?
Organizational buying refers to the
decision-making process by which formal
organizations establish the need for
purchased products and services, and
identify, evaluate, and choose among
alternative brands and suppliers.

3. Characteristics of Business Markets
• Fewer, larger buyers
• Close supplier-customer
relationships
• Professional purchasing
• Many buying influences
• Multiple sales calls
• Derived demand
• Fluctuating demand
• Direct purchasing

4. Buying Situation
Straight rebuy
Modified rebuy
New task

5. Straight rebuy
• The purchasing department reorders supplies
on a routine basis and chooses from suppliers
on an approved list

6. Modified rebuy
• The buyer wants to modify product
specifications, prices, delivery requirements,
or other terms

7. New task
• A purchaser buys a product or service for the
first time

8. The Buying Center
Initiators
Users
Influencers
Deciders
Approvers
Buyers
Gatekeepers

9. Initiators
• Users or others in the organization who
request that something be purchased

10. Users
• Those who will use the product or services

11. Influencers
• People who influence the buying decision,
often by helping define specification and
providing information for evaluating
alternatives

12. Deciders
• People who decide on product requirements
or on suppliers

13. Approvers
• People who authorize the proposed actions of
deciders or buyers

14. Buyers
• People who have formal authority to select
the supplier and arrange the purchase terms

15. Gatekeepers
• People who have the power to prevent sellers
or information from reaching members of the
buying center

16. Stages in the Buying Process
• Problem recognition
• General need description
• Product specification
• Supplier search
• Proposal solicitation
• Supplier selection
• Order-routine specification
• Performance review

17. Buygrid Framework

18. Vendor/Supplier Analysis

19. Order Routine Specification
• Listing the technical
specifications, the quantity
needed, the expected time
of delivery, return policies,
warranties

20. Order Routine Specification
Stockless
Purchase Plans
Vendor-Managed
Inventory
Continuous
Replenishment

21. Factors Affecting
Buyer-Supplier Relationships
Availability of
alternatives
Supply market
dynamism
Complexity of
supply
Importance of
supply