BUSINESS MARKET

definition

buy goods or services for further processing or for use in their production process, and reseller markets buy goods or services to resell at a profit

characteristics

  1. Nature of buying unit - business purchase involve more buyers - business buying involves a more professional purchasing effort
  1. Types of decision and the decision process - business buyers usually face more complex buying decisions - business buying process is more formalized - buyers and sellers work closely together and build long term relationship
  1. Market structure and demand - business market contain fewer but larger buyers - business customers more geographically concentrated - business buyer demand is derived from final consumer demand

major types or buying situations

  1. modified rebuy - the buyer wants to modify product specifications, price, terms or suppliers
  1. new task - a company buying a product or services for the first time faces a new task situation
  1. straight rebuy - the buyer reorder something without any modifications

the participants

  1. buyers - have formal authority to select the supplier and arrange terms of purchase
  1. decider - has formal or informal power to select or approve the final suppliers
  1. influencer - helps define specifications and also provide information for evaluating alternatives
  1. users - the members of the organization who will use the product or services
  1. gatekeepers - control the flow of information to others

the buying process

supplier search

proposal solicitation

product specification

order- routine specification

general need description

performance review

problem recognition