Business-to-business marketing: organizational buying behaviour, relationships and networks 147
pointed out, be concerned only at the policy-
making level.
These categories are useful indicators of
the different areas of interest in the buying
centre. A production engineer will view a
machine purchase in a different way to a
finance director. The transport manager will
also take a different view to that of the
managing director when the purchase of fleet
cars is considered. We should note, however,
that these roles can overlap and may vary
according to the nature of the purchase and the
stage of the buying process.
Having discussed basic purchasing struc-
ture, it is important to be aware of the factors
that will influence that structure. The next
section therefore examines the major variables
which determine the composition of the buying
centre.
Determinants of the buying centre
It has already been pointed out that the role of
the purchasing agent is dependent upon the
organization’s philosophy towards the pur-
chasing function and is therefore situation
specific. While it is possible to suggest certain
determining characteristics of the composition
of the buying centre, it should be emphasized
at the outset that the buying centre’s composi-
tion will depend upon the specific purchase
situation. The importance to suppliers of know-
ing their customers cannot be over-empha-
sized. In practical marketing terms, such
knowledge can only be built up through exten-
sive contact between suppliers and buyers.
Market factors
Wallace (1976) identifies two features relevant to
the study of organizational buying. First, those
processes which characterize organizations and
their members in their purchasing activity and,
second, those characteristics which differentiate
organizational buying markets from consumer
markets. It is these characteristics that are
referred to here as market factors.
Products and services are often techno-
logically complex and this, combined with bulk
purchasing, leads to many industrial purchases
being of high value. Also, business-to-business
markets are characterized by derived demand,
and marketing thus requires careful evaluation
of the secondary markets which influence
demand for the primary product. Furthermore,
many business markets are highly concentrated
and there tend to be greater differences
between buyers. Markets can be either geo-
graphically concentrated or concentrated
through the size of the firms. As a result,
communication channels between industrial
buyers and sellers tend to be shorter than in
consumer markets.
Finally, many business-to-business mar-
kets are characterized by reciprocal trading
arrangements between firms, which may
inhibit buying practice and make it difficult for
new suppliers to enter some markets.
Each market will have its own character-
istics and the companies that purchase from or
within that market will organize their buying
departments to meet the particular conditions
that prevail. The organization of the buying
centre to meet these market characteristics will
vary depending upon the size of the company
and the service being purchased.Company factors
Sheth (1973) suggests three major company
variables that will influence the composition of
the buying centre: company size, degree of
specialization and company orientation. It can
be expected that as company size increases the
greater the number of buying influences. Addi-
tionally, we can generally expect a higher
degree of purchasing expertise in large
organizations.
A study sponsored by The Financial Times
(1974) concluded that most companies operat-
ing several establishments ‘claimed to operate a
centralized purchasing policy for the products
covered by the survey’. However, the research
indicated that companies do in fact vary their