- Explain what a buying center is.
- Explain who the members of buying centers are and describe their roles.
- Describe the duties of professional buyers.
- Describe the personal and interpersonal dynamics that affect the decisions buying centers make.
The professors who form a committee at your school to choose textbooks are acting like a buying center. Buying centers are groups of people within organizations who make purchasing decisions. Large organizations often have permanent departments that consist of the people who, in a sense, shop for a living. They are professional buyers, in other words. Their titles vary. In some companies, they are simply referred to as buyers. In other companies, they are referred to as purchasing agents, purchasing managers, or procurement officers. Retailers often refer to their buyers as merchandisers. Most of the people who do these jobs have bachelor’s of science degrees. Some undergo additional industry training to obtain an advanced purchasing certification designation. 1
Buyers can have a large impact on the expenses, sales, and profits of a company. Pier 1’s purchasing agents literally comb the entire world looking for products the company’s customers want most. What happens if the products the purchasing agents pick don’t sell? Pier 1’s sales fall, and people get fired. This doesn’t happen in B2C markets. If you pick out the wrong comforter for your bed, you don’t get fired. Your bedroom just looks crummy.
Consequently, professional buyers are shrewd. They have to be because their jobs depend on it. Their jobs depend on their choosing the best products at the best prices from the best vendors. Professional buyers are also well informed and less likely to buy a product on a whim than consumers. The sidebar below outlines the tasks professional buyers generally perform.
The Duties of Professional Buyers
- Considering the availability of products, the reliability of the products’ vendors, and the technical support they can provide
- Studying a company’s sales records and inventory levels
- Identifying suppliers and obtaining bids from them
- Negotiating prices, delivery dates, and payment terms for goods and services
- Keeping abreast of changes in the supply and demand for goods and services their firms need
- Staying informed of the latest trends so as to anticipate consumer buying patterns
- Determining the media (TV, the Internet, newspapers, and so forth) in which advertisements will be placed
- Tracking advertisements in newspapers and other media to check competitors’ sales activities
Increasingly, purchasing managers have become responsible for buying not only products but also functions their firms want to outsource. The functions aren’t limited to manufacturing. They also include product innovation and design services, customer service and order fulfillment services, and information technology and networking services to name a few. Purchasing agents responsible for finding offshore providers of goods and services often take trips abroad to inspect the facilities of the providers and get a better sense of their capabilities.