Chapter 6
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steviet23 Plus on October 8, 2011
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33 terms
Terms | Definitions |
|---|---|
 Business and Organizational customers | Any buyers who buy for resale or to produce other goods and services. • Manufacturers • Producers of services • Retailers & wholesalers • Government units |
| buying center | all those persons in an organization who become involved in the purchase decision; includes: Buyer, influencer, Deciders, gatekeeper, user |
| competitive bids | Terms of sale offered by different suppliers in response to the buyer's purchase specifications |
| Foreign Corrupt Practices Act | A law passed by the U.S. Congress in 1977 that prohibits U.S. firms from paying bribes to foreign officials. |
| ISO 9000 | A way for a supplier to document its quality procedures according to internationally recognized standards |
| just-in-time delivery | Reliably getting products there just before the customer needs them |
| multiple buying influence | Several people share in making a purchase decision—perhaps even top management |
| negotiated contract buying | Agreeing to a contract that allows for changes in the purchase arrangements |
| North American Industry Classification System (NAICS) codes | Codes used to identify groups of firms in similar lines of business |
| open to buy | A buyer has budgeted funds that he can spend during the current time period |
| Outsource | When the buying organization chooses to contract with an outside firm to produce goods or services rather than producing them internally |
| purchasing specifications | a written (or electronic) description of what the firm wants to buy |
| resident buyers | Independent buying agents who work in central markets for several retailer or wholesaler customers based in outlying areas or other countries |
| vendor analysis | Formal rating of suppliers on all relevant areas of performance |
| Business buying process | 1. recognition of problem (increase rev./ decrease costs) 2. search for info (create buying criteria) 3. evaluate alternatives (reciprocity and crowd sourcing) 4. select product and supplier 5. evaluate post-purchase |
| New-Task Buying (BBP) | - A large amount of time, influences, review and information is required - Occurs when a customer organization has a new need and wants a great deal of information |
| Straight Rebuy (BBP) | - A small amount of time, influences, review and information is required - A routine repurchase of something that was made many times in the past. |
| Modified Rebuy (BBP) | - A medium amount of time, influences, review and information is required - A business buying situation in which the buyer wants to modify product specifications, prices, terms, or suppliers |
| What does a purchasing manager do? | - Buying specialist for their employers - In large organizations they usually specialize by product area and are real experts. |
| What are the "demographics" of manufacturers. | - More than 50% of manufacturers have less than 10 Employees - Large manufacturers (over 250 employees) account about 60% volume for U.S. - Large manufacturers only account for 3% of total manufacturers. - Clustered in geographic areas. (Automobiles centered around Midwest) |
| How large is the government market? | - It is the largest customer marketing for many countries. - Various government units spend about 30% of U.S. GDP. - $3 Trillion spent a year |
| What are the basic provisions of the Foreign Corrupt Practices Act? | If I am selling a product to a different country, I cannot offer a bribe. This is a big deal because a lot of companies must do this for business. |
| Purchase Order | a written order by a buyer for merchandise or other property specified in the purchase requisition |
| Requisition | Request to buy something |
| Buying Criteria | Rational and Emotional motives, A customer's perceptions of a product that determines whether or not the customer will purchase that product. |
| Rational Motives | Product quality and reliability, Related services, Price-terms of sales, discounts, credit, reliable delivery & Inventory MGMT |
| Emotional Motives | The forces of love, affection, guilt, fear, or passion that compel consumers to buy. Sales Representatives Personality; Reputation of the company, |
| Final consumers | Persons who buy products and services mostly for their own use. |
| Differences between organizational customers & final consumers | • Purchase criteria & specifications • Multiple buying influence • Problem-solving process • B2B e-commerce • Buyer-seller relationships |
| Organizational Buying Influences | 1. Vendor analysis considers all influences 2. Behavioral needs are important too 3. Ethical conflicts may arise 4. Purchasing may be centralized 5. Buying firm's values affect purchasing practices. |
| Buyer-Seller Relationships | Buyers and suppliers form partnerships, Powerful customer may control relationship, Buyers may use several sources to spread risk. |
| Gatekeepers | People in the organization's buying center who control the flow of information to others |
| Influencers | people inside or outside the organization who directly or indirectly provide information during the buying process |
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