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Unit 4: Business Markets and Business Buyer Behaviour

3. New Task: Such purchase involves extended decision-making because the decision is new, Notes
and the item is being purchased for the first time to perform a new job or solve a new
problem. There is often a serious risk that the product may not perform as it should or that
it will be too costly. New task purchase may involve development of product specifications,
vendor specifications and procedures for future purchase of the product. In all such
purchases, the organisational buyer needs a great deal of information and careful
establishment of criteria on which to evaluate the product for purchase.

Example: Buying heavy machinery or an aircraft for goods transportation usually is a
new task.

Self Assessment

Fill in the Blanks:
7. The activities, location, industry type, objectives etc, are referred to as …………………….

8. Buying materials from the same vendor once and again is referred to as …………………….
9. Organisation …………………… refers to the types of individuals who work in a particular
organisation.
10. Modified re-buy and new task decision are quite similar to each other while …………………
is a bit different.

4.5 Organisational Buyer Decision Process

The buying decision process is shown in Figure 4.1. Organisational buying can be traced to a
single need – solving a problem – and involves decision-making units (also called buying
centres). These are composed of individuals within an organisation who interact during making
a given purchase decision. The size of decision-making unit may vary according to how new,
complex and important the purchase decision is; and how centralised, structured and specialised
the organisation is (Table 4.2). Large and relatively more formal organisations usually involve
more individuals in a purchase decision than smaller and less formal organisations. For
non-routine decisions, such buying centres are often formed on an ad hoc basis but for routine
decisions these centres are relatively permanent.

Figure 4.1: Organisational Buying Decision Process

Problem Product Product and
recognition specifications vendor search

Performance Product and Product and
evaluation vendor selection vendor evaluation

The final purchase decision is largely determined by individual power, expertise, the degree of
influence of each functional area in a given decision, how the organisation handles group
decision conflicts and the nature of decision.
The decision-making unit can be divided on the basis of functional responsibility and type of
influence. Functional responsibility can include specific functions such as manufacturing,
engineering, research and development, purchasing and general management. Each function
evaluates the organisational needs differently and uses different evaluative criteria.

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