The document discusses industrial buying behavior and processes. It begins by explaining how industrial buying differs from consumer buying in that it involves the purchase of machinery, materials, and services for organizational use rather than direct consumption. Industrial buying is a complex process that typically involves multiple participants in the buying center, including initiators, users, influencers, and gatekeepers. There are three main types of industrial buying situations: straight rebuy, modified rebuy, and new tasks. The buying process generally involves recognizing needs, specifying requirements, searching for suppliers, analyzing proposals, selecting suppliers, and post-purchase evaluation. Decision making power is shared among a decision-making unit (DMU) comprising various roles within the organization. Key factors that influence

1. Industrial buying
behaviour

2. Introduction
• Increase in economy results into creation of Demand for
industrial goods & services, new entrant in market , rise
in competition
• Industrial buying different from consumer buying
• Involves buying like machinery, packaging material &
services such as insurance, consultation & transportation
• Commercial Buyers i.e buy to either produce something
new or resell or use for organizational purpose
• refers to the buying activities of organizations that
purchase products and services for end-use purpose.
• derived demand and not for direct consumption.
• Few buyer of industrial goods
• a lengthy process & decision of complex nature
• Each organization evolves its own procedure for making
purchase decision

3. Three important buying decision are
1.Authority to purchase
2.Determine the product specification
3.Choice of supplier
Three types of industrial Buying situations:
1.Straight Rebuy: Buying on routine basis Eg:
stationery
2.Modified Rebuy: Modify products specification,
price, Eg: Spare parts, technology
3.New Task: buying for the first time for a new task
Eg: Plant, building, e

4. • Industrial products involves:
1.Raw material
2.Fabrication parts & material
3.Installation of machinery
4.Accessories equipment's
5.Operating Suppliers
• Exchange process involves
Products/ services
Information
Financial

5. Participants in buying
process
• Initiators: One who request that something is to be
purchased
• Users: one who uses the product or service
• Influencers: People who influence buying decision
• Gatekeepers: People who have power to prevent sellers
or information from reaching members of buying centers.

6. Decision making process /
Industrial buying decision
process:
Recognition of need

Determining product specification / determining quality and
quantity characteristics

Search for suppliers

Analysis of proposals

Selection of suppliers

Selection of an order routine

Post purchase evaluation

7. Decision-Making Units
(DMUs)
• What is a DMU?
• The decision making power in industrial buying is shared by few
persons jointly/ collectively and not by one individual.
• There exists multiple buying patterns and the decision makers
are also large in number. Joint authority or buying center is
useful. Hence it results in making wise decision and also
protecting the interest of industrial organization such authority is
known as DMU.
• In industrial buying the decision making power is shared by
people collectively. DMU may be defined as all the individuals or
groups who are involved in the process of making a decision to

8. Participants Of DMU:
• Actual users: The one who uses the product. He could be a foreman
or labour or the end user help define the product specifications.
• Influencer: May or may not be an end user but whose opinion would
influence the end users choice. Eg- consultant, technical personnel,
Provides information for evaluation of alternatives.
• Buyers: Buyer who makes actual purchase on behalf of the
organization. They have the formal authority to select the suppliers
and finalized terms of purchase. Selection of vendors and negotiating
transactions.
• Deciders: Actual decision to buy, considering economic and technical
factors while making a decision to buy. He finalizes i.e. from
purchasing agent or top management personnel.
• Gatekeeper: Individuals in the organization who keep a check on the
information flow within the organization that is shared. Eg- purchases

9. Factors influencing purchase
decisions buying decisions
• Individual factors
• Age
• Income
• Edu & job
• Personality
• Attitude
• Interpersonal Factors
• Authority
• Status
• Empathy
• Persuasiveness
• Economic
Environment
• Level of demand
• Economic outlook
• Competition
• Organizational
factors
• Obj /goals
• Policies
• Procedures
• Systems
• Structures

10. Different between Industrial
& consumer Buying behavior
BASIS Consumer Market Industrial markets
Market structure Geographical Dispense Geographical
concentration
Buyers & seller Many Seller & many
buyer
Few buyer & few seller
CompeStiton