There are three different organizational markets: industrial, reseller, and government. Industrial firms in some way reprocess a product or service they buy before selling it to the next buyer. Resellers—wholesalers and retailers—buy physical products and resell them again without any reprocessing. Government agencies, at the federal, state, and local levels, buy goods and services for the constituents they serve. The North American Industry Classification System (NAICS) provides common industry definitions for Canada, Mexico, and the United States, which facilitates the measurement of economic activity for these three organizational markets. Get latest updates on the related subject in Management homework help and assignment help at transtutors.com.
Seven major characteristics of organizational buying make it different from consumer buying. These include demand characteristics, size of the order or purchase, number of potential buyers, buying objectives, buying criteria, buyer–seller relationships and supply partnerships, and multiple buying influences within organizations. The organizational buying process itself is more formalized, more individuals are involved, supplier capability is more important, and the postpurchase evaluation behavior often includes performance of the supplier and the item purchased. Figure 6–5 details how the purchase of an MP3 capable CD player differs between a consumer and organizational purchase. The case study describing the purchase of machine vision systems by an industrial firm illustrates this process in greater depth.
Buying centers and buying situations have an important influence on organizational purchasing. A buying center consists of a group of individuals who share common goals, risks, and knowledge important to a purchase decision. A buyer or purchasing manager is almost always a member of a buying center. However, other individuals may affect organizational purchasing due to their unique roles in a purchase...
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