BUSINESS PROCESS FOR PURCHASE

Question 13: List and describe the steps in the business purchase decision process.

COMMERCIAL BUYERS:

A business buyer is a party to the purchase or acquisition of part or all of a business organization. Business buyers can be individuals, groups of individuals or companies. They are responsible for purchase raw materials produced for the company that are used for business processes and for the production of the final product some products.

STORE PURCHASE PROCESS:

The process of buying a business consists of eight steps. Buyers often face a new situation when buying a mission at all stages of the purchasing process. Buyers making modifications or direct exchanges may miss some steps. In these steps, we'll look at a typical scenario of buying a new task.

Step 1: Identify the problem:

Identifying the problem is the first step in the process of buying a business where someone is in the company recognize a problem or need that can be satisfied by purchasing a good or service. Problem recognition can be the result of internal or external stimuli. Internal incentives mean that a company may decide to launch a new product that requires new production equipment and materials. Or the machine may break down and need new parts. Or is it a purchasing manager dissatisfied with the current supplier's product quality, service or prices. External stimuli means that a buyer may get some new ideas at a trade show, see an advertisement, or receive a call from a a seller who offers a better product or a lower price.

Step 2: General description of the need:

It is the stage of the business buying process in which the buyer describes general features and quantities necessary items. Precise and quick definitions are generally not required for standard articles. But for complex goods it is necessary chat with other team members such as engineers, consultants, etc. The team may want to prioritize reliability, durability, price and other desirable properties in the article. At this stage, knowledgeable salespeople can help buyers identify their needs and provide information on the value of various product properties.

Step 3: Product specification

At this stage of the business procurement process, the supplier organization decides and specifies the best technical solution Product specifications for the base item. After describing the need, the purchasing organization further develops the technical specifications of the product using a product value analysis approach that reduces production costs through rework, standardization or production by less expensive methods of production. They will then precisely define their needs product and go to the next step.

Step 4: Finding a supplier

The stage of the business buying process in which the buyer tries to find the best seller. A buyer can compile a small list of qualified suppliers by browsing business directories on the computer searching or calling other companies for referrals, either via the Internet. The newer the purchase task and the more complex and expensive the item, the longer it takes the buyer spent looking for suppliers.

Step 5: Request a quote

The phase of the business purchasing process in which the buyer invites qualified suppliers to submit bids. Some suppliers will only send a catalog or salesperson as a response. However, the buyer usually requires detailed written proposals or formal presentations from each potential supplier if the requested item is complex or expensive. Business marketers must be skilled in prospecting, writing and presenting proposals in response to the buyer offer requests.

Step 6: Choosing a supplier:

At this stage of the business purchasing process, the buyer reviews proposals and selects a supplier or suppliers. This selection of suppliers is done on the basis of several attributes such as product and service quality, reputation, timely delivery, ethical business conduct, honest communication and competitive pricing. Rated by the buyer suppliers against these attributes and identify the best suppliers. Buyers may try to negotiate better prices and terms with preferred suppliers before making a final decision selections. Many buyers prefer multiple sources of supply to avoid being completely dependent on one supplier.

Step 7: Specify the order routine

The stage of the business purchasing process in which the buyer writes the final purchase order with the selected supplier(s), list of technical specifications, quantity required, expected delivery time, return policy and warranty. For maintenance, repairs and operational items, buyers may use flat-rate contracts rather than regular contracts purchase orders. A blanket contract creates a long-term relationship in which the supplier promises repeated deliveries the buyer as needed at agreed prices for a specified period of time. Many large buyers now practice vendor-managed inventory, in which they reverse orders and inventory responsibilities towards their suppliers. Suppliers track inventory and automatically replenish stock need.

Step 8: Performance Check

The stage of the business buying process in which the buyer evaluates the supplier's performance a decides to continue, modify or abandon the arrangement. The seller's job is to monitor the same factors used by the buyer to ensure that the seller expect satisfaction.

CONCLUSION:

Overall, the eight-step purchasing process model presented provides a direct view of purchasing a business when possible. arise in a new situation of buying a task. However, the actual process is often much more complex. inside In the case of a modified outright acquisition or acquisition, some of these steps will be compressed or omitted. Each The buying organization is unique and each buying situation has its own set of requirements.