The buy grid model is a version of a theory developed as a general model of rational organizational design making, explaining how companies make decisions (Dwyer and Tanner, 2006). The buy-grid model has three components, which are: the buy-phases, the buy-class (buy situation) and the buying centres.
The buy-phases
Organizational buying behaviour can be described by using the buy-phases (Dwyer and Tanner, 2006) which helps in the explanation of the various steps that are involved in a typical organizational purchase decision making process.
Step 1, need recognition: the organizational buying process is a form of problem solving resulting from a buying situation that is created when someone (the purchasing manager, the consulting manager or as regulatory requirement) in the organization recognizes a problem that can be solved through some buying action so that the discrepancy between a desired outcome and the prevailing situation can be resolved.
Step 2, defining the product-type needed: the organization needs to identify the type of product/service that can help solve the problem.
Step 3, developing detailed specifications: after defining the type of product or service that can be used to solve the problem, a detailed specification is drawn.
Step 4, search for qualified suppliers: the organization needs to look for the information of supplier from the diverse channel such as Internet webpage, fairs, network associates, etc.
Step 5, acquisition and analysis of proposals: after having all the information from the relevant suppliers, the organization should analyse the information according to their criteria and standard.
Step 6, evaluation and selection of a supplier: the evaluation stage of the process could involve the p...
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...ent: a select meta-analysis of organization buying behaviour research”. Journal of business research
Olav Jull Sorensen (2009): “Formation, Organisation and Management of the (Global) Value Chain I a Theoretical Perspective”
Philip Kotler; Kevin Lane Keller (2009): “Marketing Management”, 13th edition, Pearson Prentice Hall, pg 61-62
Robert, F. Dwyer, and John F. Tanner. (2006): “Business Marketing: connecting strategy, relationship and learning” McGraw-Hill Education, 3rd edition. Page 71
Schiffman, Leon G; Kanuk, Leslie Lazar; Hansen, Håvard (2008): “Consumer Behaviour A european outlook” Pearson Education limited
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Svend Hollensen (2003): “Marketing Management a relationship approach”, FT Prentice Hall Financial Times, pg 9-10
Cravens, D. W., & Piercy, N. F. (2009). Strategic marketing (9th ed.). New York, NY: McGraw-Hill Company.
Armstrong, Gary, and Philip Kotler. Marketing: an introduction. 11th ed. Upper Saddle River, NJ: Pearson Prentice Hall, 2013. Print.
The consumer decision process consists of these six steps. First, problem recognition: Awareness of an unmet need. Second, information search: Search for alternatives that will meet your needs. Third, alternative evaluation: Evaluate the alternatives. Forth, purchase decision: Decide on the best alternative for you based on your criteria. Fifth, post-purchase behavior: Determine if you are satisfied with your choice. Sixth, disposal of product: Determine if you will keep it, upgrade it, or get rid of
Kotler, P. & Keller, K.L., (2009), A Framework for Marketing Management. 4th edition, Pearson Prentice Hall: USA
Three of these organisations are small scale of businesses and they are in different market. In supply chain concept, Business 1 and Business 2 are in the same position, they are both retailer. In contrast Business 3 is the wholesaler. The first step of procurement process that applied by three organisations is identify the requirement of their major products. At this stage, other department in these three organizations identify their requirements to the procurement department and normally they will provide description like quantity, requirement date, and preferred vendor. This first stage is critical because any faulty might costs the organization.
From buying a hamburger to buying a house people use a process in order to make a decision on what to buy. (book cite) describes this as the consumer decision process (pg.175). Utilizing a consumer decision process model, marketers are able to better understand how consumers are purchasing products and services. The five step consumer decision process model includes need recognition, information search, alternative evaluation, purchase, and post purchase. Not all purchases require following all five steps to a T, but consumers, whether they know it or not, follow a version of this model when making a purchase. Companies also use this model in order to effectively market their products and services. A company
Cravens, D. W., & Piercy, N. F. (2009). Strategic marketing (9th ed.). New York, NY: McGraw-Hill.
... and Engel, J. (2007). Consumer Behaviour An Asia Pacific Approach. Australia: Nelson Australia Pty Limited. 172.
Mooij, M.de. (2004). Consumer Behavior and Culture, Sage Publications, Page 102, Page 119, Page 274, Page 275
Consumer Decision Making Process A key factor in successfully marketing new/existing products or implementing a product Extension is a thorough understanding of the motivation, learning, memory, and decision Processes that influence consumers purchasing behavior. Consumer purchasing behavior theories have found their way into managerial decision making to help companies more effectively develop and launch new products, segment the market, determine market entrance and in brand management. Therefore, a better understanding of how consumers decide what to purchase is critical to the success of a product. There are numerous theories and models describing the consumer purchasing decision process.
Purchasing process is the process of buying the right material, at the right quantity, at the right moment, at the right price and from the right supplier ( Heinritz et al, 1986). It can also be defined as the way an organisation behaves towards it suppliers, as suppliers are the pillar of strength for all organisations at large. According to We...
Shiffman, L.G. & Kanuk, L.L. 2010. Consumer behaviour. 10th ed. Upper Saddle River. NJ: Pearson Prentice Hall.
...ns and material necessary that need to be consumed during the business processes. The biggest part of this activity is contract and orders related to natural gas supply, purchase and modernization of pipelines, and machinery required for maintain good condition of pipelines. Company needs to predict when and what amount of natural gas needs to be transferred to meet consumer demand. Another important task of procurement is purchase of compressors required for steady flow of natural gas to end customers and the maintenance equipment required to ensure high efficiency and dependable. It is required for the company to properly plan all supply orders to lower variable costs and increase profits. Each activity level requires supply of specific materials unique for the processes and operations, which shows that procurement is present in every single stage of value chain.
The consumer purchasing cycle involves awareness for the need for a product, a search for information about the product category, evaluation of the products available, a decision to purchase a specific item and then post-purchase interactions (such as interactions with customer service). In a company setting, a purchasing cycle is established by a purchasing department and may include steps like obtaining approval for a purchase, completing purchase requisition paperwork, soliciting bids, issuing a purchase order, receiving and inspecting the item, adding it to an inventory and paying vendor invoices.
There can be many things that might factor into the want to buy something. There are many steps that a customer takes before actually buying a product.