THE BUYGRID MODEL

Group 7
TYCOONS
THE BUYGRID MODEL

• This model was conceptualized to identify

critical decision phases, the information
needs of purchasing organizations and the
various criteria buyers consider when
making purchase decision.
• It incorporates three types of buying
situations – 1. New Task, 2. Straight
Rebuy, 3. Modified Rebuy and eight
phases in buying decision process.
A Buygrid Analytic Framework for Industrial Buying
Situations New Task Straight Modified
Rebuy Rebuy
1. Anticipation or Recognition of
problem(Need).
2. Determination of Characteristics and
quantity of needed item.
3. Description of Characteristics and
quantity of needed item.
4. Search for and qualification of potential
sources.
5. Acquisition and analysis of proposals.

6. Evaluation of proposals and selection of

suppliers.

7. Selection of an order routine.

8. Performance feedback and evaluation.

Buying Situations

New Task:
• In this situation the problem or need is
considerably different from past experiences.
Problem recognition may be triggered by
internal or external factors.
• Here, decision makers and influencers enter
into extensive problem solving activity. They
obtain a variety of information to explore
alternative solutions adequately before a
purchase can be made.
Buying Situations

Modified Rebuy:
• This situation occurs when organizational
decision makers feel that significant benefits
such as quality improvements or cost reduction
may be derived from reevaluating alternatives.
• Reevaluation of supply alternatives may be
triggered by internal and/or external forces.
• This situation occurs when firm is displeased
with the performance of present suppliers.
Buying Situations

Straight Rebuy:
• Most common buying situatuion in

Industrial purchasing.
• Purchases are continuing or recurring,

routine response is normal buying

pattern.
• Prompt delivery, consistent quality,

reasonably competitive price influence

Straight Rebuy.
Phases in Purchasing
Decision Process
Phase 1. Anticipation or Recognition of a Problem
(Need).
 It originates within the buying organization,
when products become outmoded, equipment
breaks down or existing materials are
unsatisfactory in quality or availability.
 It may also originate outside the buying
organization with a marketer who recognises
opportunities for potential performance
improvement.
Phases in Purchasing
Decision Process
Phase 2. Determination of the Charecteristics and
Quality of Needed Item.
 Organizational members determine specifically
how the situation may be resolved, problems &
solutions are narrowed & precisely analyzed.
 The narrowing of problem and alternatives is a
task internal to User department.
 Critical decisions & information needs at this
phase lie chiefly within the user department.
Phases in Purchasing
Decision Process
Phase 3. Description of the Characteristics and
Quantity of the item needed item.
 Buying influences may change from
department heads to engineering and
manufacturing personnel.
 In this phase buying influencers also begin to
look outside the firm for suppliers & product
information and for assistance in developing
product specifications.
Phases in Purchasing
Decision Process
Phase 4. Search for and Qualification of Potential
Sources.
 Buying organization begins to search for all sources
of supply, leading to qualification of suppliers.
 Qualifications sought vary with the type of buying
organization, specific buying situation & buying
influencers.
 End result of this phase is that decision makers
have determined which suppliers will be considered
as potential vendors.
Phases in Purchasing
Decision Process
Phase 5. Acquisition and Analysis of Proposals.
 Qualified suppliers are requested for proposals.
 Extensive information is required.
 A great deal of time is given to analyzing
proposals and comparing products, services &
costs.
 This phase is considered as distinct component
of purchasing process.
Phases in Purchasing
Decision Process
Phase 6. Evaluation of Proposals and Selection of
Suppliers.
 Various proposals of competing suppliers are
weighed and analyzed.
 Make or buy
 Further negotiations may continue with
selected suppliers on terms, prices, deliveries
or other aspects of suppliers’ proposals.
Phases in Purchasing
Decision Process
Phase 7. Selection of an Order Routine.
 Order routines are established by forwarding
purchase orders to vendors and status
reports to using departments, by determining
inventory levels needed over various time
periods.
 The user department does not view its
problems solved until the specified product
has been received & is available for use.
Phases in Purchasing
Decision Process
Phase 8. Performance Feedback and Evaluation.
 The final phase in purchasing process.
 It consists of a formal or informal review and
feedback regarding product performance as
well as vendor performance.
Overview of the Buygrid
Model.
Analysis of the Decision making Process.
 Creeping Commitment.

Firm commitment to final solution and

more Specific (Creeping) with each phase.

 Center of Gravity.
Various phases or combination of phases
become more critical to final outcomes of
purchase decisions.
MARKETING IMPLICATIONS
•Marketing strategy is greatly affected by both
purchasing situation and decision phase of
customer.
•The most important phases affecting marketing

strategies are phase1 to phase 5

•IN suppliers

•OUT suppliers
 NEW TASK
 Phase 1: Anticipate problem; use advertising and
creative sales people to convince buyers of
problem solving capabilities.

 Phase 2: provide technical assistance and

information.

 Phase 3: Provide detailed product/service

information to decision makers.
 Phase 4: IN suppliers maintain dependability;
OUT suppliers demonstrate ability
to perform task.
 Phase 5: Understand details of customer
problem/needs; make timely
proposals.
 MODIFIED REBUY
 Phase 1:IN supplier: maintain quality/service
standard;
OUT suppliers watch for developing
trends.
 Phase 2: IN and OUT suppliers stress capability,
reliability, and problem solving
capabilities
 Phase 3: same as phase 2.
 Phase 4: IN suppliers watch for problems
OUT suppliers demonstrate ability
to perform task.
 Phase 5: Understand details of customer
problem/needs; make timely
proposals.
 STRAIGHT REBUY
 Phase 1: IN suppliers maintain close relationship
with users and buyers; OUT suppliers convince
firm to reexamine alternatives.
 Phase 2 : same as phase 1.
 Phase3 : same as phase 1.
 Phase4 : same as phase 1.
 Phase 5: make timely proposals.
THANK YOU