Industrial Marketing

MKTG3001--Week 3

YIYANG MAO C3123909

2. A. Define buying situation confronting Jim and Outline the appropriate strategy he should follow in each case.

1) New task-- As the name implies you are planning to buy something new, new products, suppliers.

When confronting a new-task buying situation, organization buyers operate in a stage of decision-making referred to as extensive problem solving.

Buying decision Approaches: judgmental new task and strategic new task.

2) Straight rebuy-- Go on buying again the same thing (Jim confronting now)

Routine problem solving is the decision process organizational buyers employ in the straight rebuy.

Buying Decision Approach: casual and routine low priority.

3) Modified rebuy--Change in supplier or product in order to reduce cost or improve quality.

Limited problem solving best describes the decision-making process for the modified rebuy.

Buying Decision Approach: simple modified rrbuy and complex modified rebuy.

5. Discuss differences between centralization and decentralization used by procurement.

Centralization places the responsibility for decision-making at higher levels, concentrating both authority and power at the top management. It minimizes the role of the individual employee which is centralizing.

Decentralization places decision authority in the hands of the individuals and teams who are closest to a problem or who manage a process.

7. Predicting Composition: A marker can also predict composition of buying center by projecting the effect of the industrial product on various functional areas in the organization.

Members of buying center assume different roles throughout the procurement process. Users, influencers, buyers, deciders and gatekeeper