Published by: Mandira
Published date: 01 Mar 2022
Like a consumer, an organization also follows several steps in buying their requirements. Buying process of the organizations may vary from one another depending upon the nature of organizations, volume of purchase, amount involved in the purchase. Therefore, there is no hard and fast rule regrading the buying process of the organizations. However, the most commonly used buying process may be as follows:
Recognizing a need or a problem: Recognizing the need or requirement of the organization, such as stationeries, furniture, flooring and furnishing, raw materials, component parts, computers, etc. is the first step of an organizational buying process.
Determining the product and buying specification: It is the second step of buying process. This step involves determining the product and buying specifications such as quality, quantity price, method of payment, mode of payment, delivery date and place, design of the product, etc.
Listing and identifying the supplier/suppliers: At this step, the organization or concerned authorities identifying the potential suppliers that can supply goods and services according to the accepted product specifications and mutually-agreed terms and conditions.
Evaluation and selecting the most reliable and component supplier: Evaluating and selecting the most reliable and capable supplier, who can supply products to the organization according to its requirements is done at this step. While evaluating the suppliers, several criteria may be adopted such as the past performance of the supplier, regularity, punctuality, product quality, price of the products, terms of the delivery of goods, firm’s relation with the supplier, reliability, etc.
Purchase decision: At this step the organizations purchase their required goods from selected suppliers.
Evaluation performance of supplier: This the post purchase step of organizational buying process. It involves evaluating the supplier’s sales performance i.e, post purchase behavior of the suppliers. Evaluation may be done on the basis of the quality of his services, business efficiency, punctuality, etc. If the organization or the purchasing department is satisfied with the past purchase behavior, decision may be done to make purchase from the same supplier or the similar product from any supplier.