0302

Problem

Jim Jackson, an industrial salesperson for Pittsburgh Machine Tool, will call on two accounts this afternoon. The first will be a buying organization Jim has been servicing for the past three years. The second call, however, poses more of a challenge. This buying organization has been dealing with a prime competitor of Pittsburgh Machine Tool for five years. Jim, who has good rapport with the purchasing and engineering departments, feels that the time may be right to penetrate this account. Recently, Jim learned that the purchasing manager was extremely unhappy with the existing supplier’s poor delivery service. Define the buying situations confronting Jim and outline the appropriate strategy he should follow in each case.

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Step 1/2

Organizational buying concept is not an individual or a mere act but a process. Usually, buying behavior involves from requirements and critical decisions.

The pioneer organizations with better purchasing records specify attention not on products but on buying situations. There are three types of buying situations that are defined. They are;

1. New task

2. Modified rebuy

3. Straight rebuy

“Modified rebuy” is a typical buying situation in which decision makers in an organization desires to consider alternative solutions apart from existing ones to extract additional benefits. In this situation, JJ an industrial sales person for PM Tool is in a modified buying situation.

Step 2/2

The above described modified rebuy has following buying situations. These situations and the appropriate strategies JJ should follow in each case are given below in detail:

I. Simple modified rebuy involves fewer alternatives with mere information.

Buying departments must stress on choosing and execution of business operations with the suppliers even if the cost is a bit high. It enhances improvement in company’s selling operations.

II. Complex modified rebuy relates to a wide set of alternatives.

Purchase managers must ensure that the company proceeds for the purchase for lowest possible prices as there are ample of alternatives with abundant information and sophisticated technology in hand.