350: Ch. 3 Buying Behavior And The Buying Process

Front 1

(OEMs) Original Equipment Manufacturers

Back 1

purchase goods (components, subassembilies, raw and processed materials) to use in making their products.

Ex: When a distributor sells pizza toppings to a restaurant

Front 2

end users

Back 2

when producers buy goods and services to support their own production and operations, they are acting as blank

Front 3

Capital equipment

Back 3

items are major purchases, such as mainframe computers and machine tools that the producer uses for a number of years

Front 4

MRO supplies

Back 4

include paper towels and replacement parts for machinery.

Front 5

Services

Back 5

include Internet and telephone connections, employment agencies, consultants, and transportation.

Front 6

Resellers

Back 6

buy finished products or services with the intention to resell them to businesses and consumers

Front 7

turnover

Back 7

or how quickly a product will sell; and how much effort it takes to sell the product

Front 8

profit margin

Back 8

or how much they make on each sale

Front 9

derived demand

Back 9

means that purchases made by these customer ultimately depend on the deman rather than direct demand - either organizations or consumers

Front 10

creeping commitment

Back 10

means a customer becomes increasingly committed to a particular course of action while going through the steps in the buying process

Front 11

new task

Back 11

when a customer purchases a product or service for the first time. Most purchasing decisions involving capital equipment or the initial purchase of OEM product are this

Front 12

straight rebuy

Back 12

the customer buys the same product from the same source it used when the need arose previously.

Front 13

modified rebuy

Back 13

the customer has purchased the product or a similar product in the past but is interested in obtaining new information.

Front 14

Buying Center

Back 14

an informal, cross-department group of peoople involved in a purchase decision.

Front 15

Users

Back 15

such as the manufacturing personnal for OEM products and capital equipment, typically do not make the ultimate purchase decision

Front 16

initiator

Back 16

the person who starts the buying process

Front 17

Influencers

Back 17

people inside or outside the organization who directly or indirectly provide information during the process

Front 18

economic influencers

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person who is concerned about the financial aspects of the decision.

Front 19

technical influencer

Back 19

a person who makes sure the technical requirements (Including logistics, terms and conditions, quality measurments, or toher specifications) are met.

Front 20

coach

Back 20

someone in a buying organization who can advise and direct you, the salesperson, in maneuvering through the buying process in an effective fashion, leading to a sale.

Front 21

gatekeepers

Back 21

control the flow of information and may limit the alternatives considered.

Ex: the quality control and service departments may determine which potential suppliers are qualified sources.

Front 22

deciders

Back 22

In any buying decision one or more members of the group make the final choice

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rational needs

Back 23

directly related to the performance of the product.

Front 24

emotional needs

Back 24

are assoicated with the personal rewards and gratification of the person buying the product

Front 25

life-cycle costing

Back 25

also referred to as the total cost of ownership, is a method for determining the cost of equipment or supllies over their useful lives

Front 26

value analysis

Back 26

an example of a program in which suppliers and customers work together to reduce costs and still provide the required level of performance

Front 27

vendor loyalty

Back 27

to continue to buying from suppliers that proved satisfactory in the past.

Front 28

lost for good

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for all the out-suppliers, thi account can be considered lost for good because the in-supplier has cemented thi relationship for a long-time.

Front 29

always a share

Back 29

meaning the buuyer will always allocate only a share to each vendor.

Front 30

supply chain management (SCM)

Back 30

began as a set of programs undertaken to increase the efficency of the distribution channel that moves products from the producer's facilities to the end user.

Front 31

(JIT) Just in time inventory control system

Back 31

is an example of a logistics SCM system used by a producers to minimize its inventory by having frequent deliveries, sometimes daily, for assembly into the final product.

Front 32

quick -response system or Efficent consumer Response (ECR) systems

Back 32

retailers and distributors work closely with their suppliers to minimize inventory investments and still satisfy the needs of customers.

Front 33

Automatic replenishment

Back 33

is a form of JIT where the supplier manages inventory levels for the customer.

Front 34

Electronic Data Interchange (EDI)

Back 34

computer systems that share data across companies

Front 35

material requirements planning (MRP) systems

Back 35

are used to forecast sales, develop a production schedule, and then order parts and raw materials with delivery dates that minimize the amount of inventory needed, therby reducing costs

Front 36

supplier relationship management (SRM)

Back 36

a strategy by which organizational buyers evaluate the relative importance of suppliers and use that information to determine with whom they want to develop partnerships

Front 37

annual spend

Back 37

amount that is spent with each vendor and for what products

Front 38

vendor analysis

Back 38

after the relative importance is identified, organizational buyers frequently use a formal method to summarize the benefits and needs satisfied by a supplier