Business and Organizational Customers

any buyers who buy for resale or to produce other goods and services - producers of goods and services, intermediaries, government units, nonprofit organizations

Purchasing Specifications

a written or electronic description of what the firm wants to buy

- less specifications for a manufactured item

- more specifications for a service item

ISO 9000

a way for a supplier to document its quality procedures according to internationally recognized standards

- assures a customer that the supplier has effective quality checks in place

Purchasing Managers

buying specialists for their employers

- are usually real experts

- want salespeople to provide accurate information that will help them buy wisely

Buying Center

all the people who participate in or influence a purchase

- include: buyers, users, influencers, gatekeepers and deciders

Vendor Analysis

a formal rating of suppliers on all relevant areas of performance

- the goal is to lower the total costs associated with purchases

Requisition

when a person who needs to purchase something make a request to buy something

- can take time to get through management; from hours for a simple purchase to months for a complex purchase

New-task buying

occurs when a customer organization has a new need and wants a great deal of information

- can involve: setting product specifications, evaluating sources of supply, and establishing an order routine that can be followed in the future if results are satisfactory

- multiple buying influence is common

straight rebuy

a routine repurchase that may have been made many times before

- not looking for new information or new sources of supply

modified rebuy

some review of the buying situation is done - though not as much as in new-task buying

Competitive Bid

the terms of sale offered by the supplier in response to the purchase specifications posted by a buyer

Just-In-Time Delivery

reliably getting products there just before the customer needs them

- colser relationships between buyers and sellers involve operational linkages that lower costs and increase efficiency

Negotiated contract buying

means agreeing to contracts that allow for changes in the purchase arrangements

- the general project and base price are described but with provision for changes and price adjustments up or down

Outsource

a contract with an outside firm to produce goods and services rather than to produce them internally

groups of firms in similar lines of business

- the number of establishments, sales volumes, and number of employees - broken down by geographic areas - are given by NAICS code

Open to buy

if money has not yet been spent; buyers have budgeted funds that can be spent during the current period

Resident Buyers

are independent buying agents who work in central markets for several retailer or wholesaler customers based in outlying areas or other countries

Foreign Corrupt Practices Act

Prohibits U.S. firms from paying bribes to foreign officials

- passed by the U.S. Congress in 1977

Multiple Buying Influence

that several people - perhaps even top management - play a part in making a purchase decision

- possible influences include: users, influencers, buyers, deciders, gatekeepers