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Analyzing Business Markets and Business Buying Behaviors

This document summarizes business markets and organizational buying behaviors. It discusses the differences between business and consumer markets, as well as the buying situations and participants involved in business purchases. Business markets have fewer buyers that are large organizations, demand is derived and inelastic, and relationships with suppliers are close. Organizational buying involves buying centers made up of different roles that influence the purchase. Major factors that influence business buying include environmental, organizational, interpersonal, and individual/cultural considerations.

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amanraaj
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51 views9 pages

Analyzing Business Markets and Business Buying Behaviors

This document summarizes business markets and organizational buying behaviors. It discusses the differences between business and consumer markets, as well as the buying situations and participants involved in business purchases. Business markets have fewer buyers that are large organizations, demand is derived and inelastic, and relationships with suppliers are close. Organizational buying involves buying centers made up of different roles that influence the purchase. Major factors that influence business buying include environmental, organizational, interpersonal, and individual/cultural considerations.

Uploaded by

amanraaj
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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CHAPTER 7

ANALYZING BUSINESS MARKETS AND BUSINESS BUYING BEHAVIORS

BUSINESS-TO-BUSINESS MARKET
Business Business Consumers

Business-to-Business Consumer Market Market 1. Businesses 2. Government/Military 3. Institutions

ORGANIZATIONAL BUYING
Business vs. Consumer Market: Mrk.Characteristics Consumer Business Number of buyers Many Few Size of Buyers Small Large Supplier Relations No Close Concentration No. Yes Demand Unpredictable Derived Demand Elastic Inelastic

ORGANIZATIONAL BUYING (CONT.)


Mrk.Characteristics Consumer Business Demand Normal Fluctuating Professional Purchasing No Yes Purchasing Middlemen Direct Buying Influence No Yes Reciprocity No Yes Leasing Some Heavy

BUYING SITUATION
(A)New Task (B)Modified Re-buy (C)Straight Re-buy Buy-grid Model (A) (B) Problem recognition Yes Maybe Need Description Yes Maybe Product Specification Yes Yes

(C) No No Yes

BUYING SITUATION (CONT.)


Buy-grid model (cont.) (A) (B) Supplier search Yes Maybe Proposal solicitation Yes Maybe Supplier selection Yes Maybe Proposal solicitation Yes Maybe Supplier selection Yes Maybe Order-routine Spec. Yes Maybe Performance Review Yes Yes

(C) No No No No No No Yes

PARTICIPATION IN BUSINESS BUYING

System Buying/Selling:
System contracting:

Single supply source provides the entire requirement of MRO.

Large scale projects such as dams, refineries, steel factories.

Buying Centers:
1. 2. 3. 4. 5. 6. 7. Initiators Users Influencers Deciders Approvers Buyers Gatekeepers

PARTICIPANTS IN THE BUSINESS BUYING(CONT.)

Major Influences In Business Buying:


Environmental factors:

Demand economic outlook interest rate Technology political life Competition social responsibility;

PARTICIPANTS IN THE BUSINESS BUYING (CONT.)

Major Influences in Business Buying (cont.):


Organizational factors:

Purchasing department upgrading.. Cross-functional roles. Centralized purchasing. Decentralized purchasing for small ticket items. Internet purchasing. Long term contract. Purchasing-performance evaluation. Lean production-high quality and JIT inventory planning. Interest, authority, status, empathy and persuasiveness. Age,income, education, job position, personality,risk attitudes

Interpersonal factors:

Individual factors:

Cultural factors

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