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11 Cards in this Set
- Front
- Back
Describe business buying behavior.
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Business buying behavior: the buying behavior of the organizations that buy goods and services for use in the production of other products and services or to resell or rent them to others at a profit
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Describe business buying process.
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Business buying process: the decision process by which business buyers determine which products and services their organizations need to purchase
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What are the characteristics of business markets?
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Market structure and demand:
o Business markets contain fewer but larger buyers o Business buyer demand is derived from final consumer demand o Demand in many business markets is more inelastic – not affected as much in the short run by price changes o Demand in business markets fluctuates more, and more quickly Nature of the buying unit: o Business purchases involve more buyers o Business buying involves a more professional purchasing effort Types of decisions and the decision process: o Business buyers usually face more complex buying decisions o The business buying process is more formalized o In business buying, buyers and sellers work more closely together and build close long-term relationships |
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Which two parts are involved in the buying activity?
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1. The buying center
2. The buying process |
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List the three major types of buying situations.
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1. Straight rebuy:
o A business buying situation in which the buyer routinely reorders something without any modifications 2. Modified rebuy: o A business buying situation in which the buyer wants to modify product specifications, prices, terms or suppliers 3. New-task: o A business buying situation in which the buyer purchases a product or service for the first time |
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Name the participants in the business buying process.
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Users:
o Members of the buying organization who will use the product or service Influencers: o People in an organization’s buying center who affect the buying decision; they will often help define specifications and also provide information for evaluating alternatives Buyers: o Members of the buying organization who make a purchase Deciders: o People in an organization’s buying center who have formal or informal power to select or approve the final suppliers Gatekeepers: o People who control the flow of information to others |
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What are the major influences on business buyers?
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Not only financial, but also personal.
- Environmental factors - Organizational factors - Interpersonal factors - Individual factors |
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Explain the business buying process.
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1. Problem recognition: someone in the company recognizes a problem or need that can be met by acquiring a good or service
2. General need description: the company describes the characteristics and quantity of the needed item 3. Product specification 4. Supplier search: to find the best vendor 5. Proposal solicitation the buyer invites qualified suppliers to submit proposals 6. Supplier selection 7. Performance review: the buyer reviews supplier performance |
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What is e-procurement?
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E-procurement: purchasing through electric connections between buyers and sellers – usually online
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What is an institutional market?
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Institutional market: schools, hospitals, nursing homes, prisons and other institutions that provide goods and services to people in their care
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What is a government market?
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Government markets: government units – national, regional and local – that purchase or rent goods and services for carrying out the main functions of government
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