Industrial BuyingIndustrial Buying

andand

BuyingBuying Behaviour Behaviour

Models Models

Communicating BenefitsCommunicating Benefits

Customer BenefitCustomer Benefit

Competitive PriceCompetitive Price

High QualityHigh Quality

JIT DeliveryJIT Delivery

Willingness for ChangesWillingness for Changes

Factory at 4 LocationsFactory at 4 Locations

E- CommerceE- Commerce

Customized ManufactureCustomized Manufacture

24/7 Response24/7 Response

SellerSeller

Buying CenterBuying Center

C F OC F O

F M/P M / ForemanF M/P M / Foreman

C E OC E O

Purchase ManagerPurchase Manager

Marketing ManagerMarketing Manager

Logistics OfficerLogistics Officer

Warehouse ManagerWarehouse Manager

Maintenance Mgr.Maintenance Mgr.

BuyerBuyer

Buying Orientation

1. Lowest Price

2. Gain Power in the Market in

terms of USP and Product

Features

3. Minimizing Risk

Procurement Orientation

Collaborative Relationship

Timely Delivery

Working Closely with other

functional areas

Supply Chain Management

Deliver value to end user.

Outsource Non-core activities.

Support Collaborative

Relationship.

Major Consideration for Purchase Decision

1. Consistency of Quality

2. Lowest price

3. Time Saving

4. Assurance of Supply

5. Suppliers Relationship

Types of Purchases 1. New Tasks - Prospecting and Lead generation - Vendor Development - Short listing of the Vendors / Suppliers 2. Repeat Purchases3. Modified Re-buy

Buying Decision Models

Webster and Wind’s Model1. Superiority of Organizaional Variables2. Followed by the Attitudinal

Variables3. Work- Specification

Variables4. Price Variables

Webster and Wind Model

EnvironmentalVariables

OrganizationalVariables

Buying CentreVariables

IndividualVariables

OrganizationalBuying

Decisions

Environmental Variables

1. Competitive Practices andPressures

2. Suppliers Information

3. Customer Demands

4. Technological

5. Labour Issues

6. Laws and Regulations

Organizational Variables

1. Objectives and Goals

2. Organizational Structure

3. Purchase Policies andProcedure

4. Degree of Decentralization

5. Evaluation and Reward System

Buying Center Variables

1. Authority and Role

2. Size

3. Resources

4. Key Influencers

5. Interpersonal Relationship

6. Communication

Personal Variables

1. Personal Goals

2. Education and Expertise

3. Experience

4. Values

5. Job Position

6. Income

Webster and Wind Model

Strengths

Comprehensive Generally Applicable

Analytical

Identifies Key Variables

Helpful in Developing Industrial marketing Strategies

Webster and Wind Model

Weakness

Model is Weak in Explaining

the Specific Influence of Key

Variables

Sheth Model

Prof. Jagdish n. Sheth (1973)

Emphasizes on Joint DecisionMaking by Two or Moreindividuals

Psychological Aspect of Decision Making IndividualsIn the Industrial BuyingBehaviour

Sheth Model (1) Differences

Among IndividualBuyers

(2) Autonomous Or Joint Decisions

(3) Methods UsedFor ConflictResolution

Situational Factors

OrganizationalBuying

Decisions

Personal Variables

1. Personal Goals

2. Education and Expertise

3. Experience

4. Values

5. Job Position

6. Income

Personal Variables

1. Background

2. Information Source

3. Active Search

4. Perceptual Distortion

5. Satisfaction With PastPurchases

Product SpecificFactors

1. Time Pressure

2. Perceived Risk

3. Type of Purchases

Company SpecificFactors

1. Company Size

2. Company Orientation

3. Degree of Centralization

Conflict Resolution

1. Problem Solving

2. Persuasion

3. Bargaining

4. Politicking

Sheth Model (1) Differences

Among IndividualBuyers

(2) Autonomous Or Joint Decisions

(3) Methods UsedFor ConflictResolution

Situational Factors

OrganizationalBuying

Decisions