ECON344 Lecture Notes - Franchising, Alcon, Personal Selling
16 Oct 2011
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Definition: process of buying and selling goods or services to be used in the production of other goods and services, for consumption by the buying organization, or for resale by wholesalers and retailers. Manufacturers: buy raw materials that allow them to manufacture their own goods. Resellers: marketing intermediaries that resell manufactured products without significantly altering their form. Manufacturers sell to wholesalers/retailers (b2b transaction), then retailers sell to ultimate consumers (b2c transaction: wholesalers, distributors, retailers are all resellers. Institutions: hospitals, educational organizations, prisons, and other non-profit organizations. Purchase goods and services for people they serve. Differences between b2b and b2c markets (about b2b) Demand is more inelastic, fluctuates more, and more frequently. Fewer customers, more geographically concentrated, orders are larger. Products are technical in nature, purchased based on specifications. Main raw and semi-finished goods are purchased. Heavy emphasis is placed on delivery time, technical assistance, after sale service, and financing assistance. Buying may involve competitive bidding, negotiated pricing, complex financial arrangements.
