Chapter Seven
BUSINESS AND ORGANIZATIONAL CUSTOMERS AND THEIR BUYING BEHAVIOR
Business and organizational customers are buyers who buy for resale or to produce other goods and services
See exhibit 7-1, page 179
MANY PEOPLE MAY INFLUENCE A DECISION
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Users |
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Influencers |
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Buyers |
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Deciders |
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Gatekeepers |
See Exhibit 7-2, page 183 to view a model of the buying center.
Three kinds of buying processes:
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New task: Organization has a new need -- buyer wants a lot of information |
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Straight rebuy: routine repurchase |
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Modified rebuy: some review is done |
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Note: See Exhibit 7-4, page 186 |
Organization uses purchasing agents which are buying specialists for their employees.
They like: information on new goods, price changes, supply shortages, etc.
Most firms have centralized buying
Buyers consider: total cost of owning and operating, productivity, quality, maintenance, repair, delivery time, etc.
Behavioral needs are relevant: exhibit 7-3, page 189
BUYER-SELLER RELATIONSHIPS IN BUSINESS MARKETS
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See Exhibit 7-6, page 189 |
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Powerful customer can control relationship |
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Buyers like to spread risk by using several sources of suppliers |
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Computer buying is also becoming common and JIT delivery more important |
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Reciprocity may be utilized |
INTERNET E-COMMERCE IS RESHAPING MANY BUSINESS MARKETS
See Exhibit 7-7, page 195
Search "Bots" help purchasing managers locate products on the Internet
E-Commerce computer systems can handle a large portion of routine order placing
MANUFACTURERS ARE IMPORTANT CUSTOMERS
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Only 355,000 factories (See Exhibit 7-8, page 199) |
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Detailed information is available from NAICS information (See Exhibit 7-9, page 201) |
PRODUCERS OF SERVICES -- SMALL AND SPREAD OUT
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US has 2,500,000 service firms |
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Purchasing is handled by whoever is in charge |
RETAILERS AND WHOLESALERS BUY FOR THEIR CUSTOMERS
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Retailers and wholesalers use reorders as straight rebuys and use computerized inventory control |
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Buyers are in close contact with sales people |
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Some retailers use committees |
THE GOVERNMENT MARKET
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35% of GNP is spent by government units |
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Use mandatory bidding bidding lists, negotiated contracts, etc., are also used |
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Some foreign governments may require “grease money” |
Next Steps: Please review the PowerPoint Overview slides (1-9) for this chapter. Then proceed to the lecture notes for chapter seven.
