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| The buying behavior of organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others. p 168 |
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| The decision process by which business buyers determine which products and services their organizations need to purchase and then find, evaluate, and choose among alternative suppliers and brands. p 168 book: Buyers who face a new task buying situation usually go through all stages of the buying process. Buyers making modified or straight rebuys, in contrast, may skip some of the stages. p 175 |
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| business demand that ultimately comes form (derives from) the demand for consumer goods p 169 |
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| Systematic development of networks of supplier- partners to ensure an appropriate and dependable supply of products and materials for use in making products or reselling them to others. p 170 |
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| supplier development (example from book) |
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| The giant retailer knows that it can’t just rely on spot suppliers who might be available when needed. Instead, Walmart manages a robust network of supplier- partners that help provide the hundreds of billions of dollars of goods that it sells to its customers each year. |
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| A business buying situation in which the buyer routinely reorders something without any modifications. p 171 |
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| A business buying situation in which the buyer wants to modify product specifications, prices, terms, or suppliers. p 171 |
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| A business buying situation in which the buyer purchases a product or service for the first time. p 171 |
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| Systems selling ( or solutions selling) |
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| Buying a packaged solution to a problem from a single seller, thus avoiding all the separate decisions involved in a complex buying situation. p 171 |
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| All the individuals and units that play a role in the purchase decision-making process. p 172 |
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| Members of the buying organization who will actually use the purchased product or service. p 172 |
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| People in an organization’s buying center who affect the buying decision; they often help define specifications and also provide information for evaluating alternatives. p 172 book example: tech personnel |
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| People in an organization’s buying center who make an actual purchase. p 172 book example: Buyers have formal authority to select the supplier and arrange terms of purchase. Buyers may help shape product specifications, but their major role is in selecting ven-dors and negotiating. In more complex purchases, buyers might include high-level officers participating in the negotiations. |
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| People in an organization’s buying center who have formal or informal power to select or approve the final suppliers. p 172 book: In routine buying, the buyers are often the deciders, or at least the approvers. |
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| People in an organization’s buying center who control the flow of information to others. p 172 book: For example, purchasing agents often have authority to prevent salespersons from seeing users or deciders. Other gatekeepers include technical personnel and even personal secretaries. |
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| 8 stages of buying process |
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Definition
| 1) Problem recognition 2) General need description 3) Product specification 4) Supplier search 5) Proposal solicitation 6) Supplier selection 7) Order-routine specification 8) Performance review |
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| The stage of the business buying process in which the company recognizes a problem or need that can be met by acquiring a good or a service. p 175 book: Externally, the buyer may get some new ideas at a trade show, see an ad, or receive a call from a salesperson who offers a better product or a lower price. |
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| Stage in the business buying process in which buyer describes general characteristics & quantity of needed item. p 176 book: For complex items, ...buyer may need to work with others— engineers, users, consultants— to define item. The team may want to rank the importance of reliability, durability, price, and other attributes... In this phase, the alert business marketer can help the buyers define their needs and provide information about the value of different product characteristics. p 175-6 |
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| The stage of the business buying process in which the buying organization decides on and specifies the best technical product characteristics for a needed item. p 176 book: often with the help of a value analysis engineering team. Product value analysis is an approach to cost reduction in which components are studied carefully to determine if they can be redesigned, standardized, or made by less costly methods of production. Sellers, too, can use value analysis as a tool to help secure a new account. By showing buyers a better way to make an object, outside sellers can turn straight rebuy situations into new task situations that give them a chance to obtain new business. |
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| The stage of the business buying process in which the buyer tries to find the best vendors. p 176 book: Internet has levels playing field. The newer the buying task, and the more complex and costly the item, the greater the amount of time the buyer will spend searching for suppliers. The supplier’s task is to get listed in major directories and build a good reputation in the marketplace. |
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| The stage of the business buying process in which the buyer invites qualified suppliers to submit proposals. p 176 book: when the item is complex or expensive, the buyer will usually require detailed written pro-posals or formal presentations from each potential supplier. |
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Stage of business buying process in which buyer reviews proposals & selects supplier(s). p 176 book: buying center often will draw up list of desired supplier attributes & relative importance. (see "supplier attribute list")
buying center will rate suppliers against [this list] Buyers may attempt to negotiate with preferred suppliers for better prices & terms before making final selections. In the end, they may select single supplier or a few. Many buyers prefer multiple sources ... to avoid being totally dependent on one supplier |
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| Stage of business buying process in which the buyer assesses the performance of the supplier and decides to continue, modify, or drop the arrangement. p 177 book: buyer may survey user satisfaction |
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Purchasing through electronic connections between buyers & sellers— usu online. p 177 book: gives buyers access to new suppliers, lower purchasing costs, hastens order processing & delivery. can be done thru
-- reverse auctions
-- trading exchanges
---- (cos. work collectively)
-- co. buying sites
---- (eg, GE sets up site for bids, negotiating, etc.)
-- extranet links
---- (eg, Staples set up B-to-B site for offices0 |
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| Schools, hospitals, nursing homes, prisons, and other institutions that provide goods and services to people in their care. p 180 book: low budgets & captive patrons (hospital patients have little choice of food) |
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Governmental units— federal, state, and local— that purchase or rent goods and services for carrying out the main functions of government. p 181 book:
-- opportunities for large & small companies
-- uniquely subject to public review
----(resulting in complaints from sellers re bureaucracy, delays, regulations, frequent personnel shifts) |
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| supplier attribute list (not in definitions) |
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Definition
-- product and service quality
-- reputation
-- on- time delivery
-- ethical corporate behavior
-- honest communication
-- competitive prices. |
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