ANALYSING BUSINESS MARKETS

PART II

BUYING SITUATIONS

Business buyer faces many decisions in making a purchase

HOW MANY ?

Depends on the complexity of the problem being solved, newness of the buying requirement,number of

people and time required.

TYPES OF BUYING SITUATIONS

Straight

Rebuy

Purchaser

Supplier

• The purchasing department re-orders kn a routine basis and chooses from suppliers on an approved list.

• Product service and quality is maintained

• ‘Out-suppliers’ get a small order and then enlarge their purchase share over time.

Modified

Rebuy

Purchaser

Supplier

Purchaser Supplier

• Buyer wants to modify product specifications,

prices, delivery requirements or other terms.

• Involves additional participants on both sides

• In-supplies become nervous inorder to protect and

Ou-sippliers get an oppurtunity to gain some

business.

New

Task

• A purchaser buys a product or service for the first time.

• The greater the cost or risk,the larger the number of participants and the

greater their information gathering-and therefore the longer the time needed to

make a decision.

Purchaser???

Supplier

Marketing

implications of

buying

situations

Systems

Buying

and

selling

System buying

• Many business buyers prefer to buy a total

solution from one seller -> SYSTEM BUYING

• Originated with the government

•Consists of : 1) Prime contractors

2)Second-tier contractors

• In Systems Contracting, a single supplier

provides the buyer with its entire requirement of

MRO

Primary Contractor Second-tier Contractor

System selling

• Sellers recognizing that buyers like to purchase a

total solution,will adopt system selling as a marketing

tool.

• Key industrial marketing strategy in bidding to

large-scale industrial projects

• Customers present potentioal suppliers with a list of

project specifications and requirements

Key strategy for large-scale projects

Created by Aburvaa Ramesh, SVCE , during an internship By Prof. Sameer Mathur, IIM Lucknow.www.IIMInternship.com