Buying center

A buying center, also called decision-making unit (DMU), brings together "all those members of an organization who become involved in the buying process for a particular product or service". The concept of a buying center (as a focus of business-to-business marketing, and as a core fundamental in creating customer value and influence in organisational efficiency and effectiveness) formulates the understanding of purchasing decision-making in complex environments.

Some of the key factors influencing a buying center or DMU's activities include:

Four main buying decisions can be distinguished in the area of organisational buyers: Straight rebuy, Modified rebuy, New-task buying and Systems buying.

This is a routine, low involvement purchase. Minimal information is needed and consideration of alternatives is not needed. This type of purchase is handled by the purchase department and is usually purchased from a list of approved suppliers. Examples of straight rebuy are repeat purchases of office supplies, and small components.

This type of purchase is similar to a straight rebuy with more information and people involved. The buyer may want to reconsider suppliers, prices, terms, or modify product specifications.

New-task buying is deemed the most complex buying situation because it is a first-time purchase of a major product. Several people are involved in the decision because there can be high amounts of money and risk. Much information is gathered and evaluations of alternatives are explored. It is also complex as the decision makers have little experience with the product before the purchase can be made. The buying center has the challenge of finding out all the organisation's needs and communicating the product's ability of meeting the needs.

This type of buying is purchasing a packaged solution to a problem from a single supplier. This originates from governments buying packages such a major communications systems. Instead of buying separate components, buyers look for suppliers who supply the components and assemble the package for them.

When the DMU wants to purchase a certain product or service the following steps are taken inside the buying center:

In this process of making decisions different roles can be given to certain members of the center of the unit depending on the importance of the part of the organization.

The different roles are:

In some cases the buying center is an informal ad hoc group, but in other cases, it is a formally sanctioned group with specific mandates, criteria, and procedures.

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