Business Markets

The business market consists of all the organisations that buy goods and services to use in the production of other products and services that are sold or supplied to others. It also includes retailing and wholesaling firms that acquire goods for the purpose of reselling or renting them to others at a profit.

The business market is vast. In many ways, business markets are like consumer markets, but business markets usually have fewer, large buyers who are more geographically concentrated. Business demand is derived, largely inelastic and more fluctuating. The business buying decision process itself consists of eight stages: problem recognition, general need description, product specification, supplier search, proposal solicitation, supplier selection, order routine specification and performance review. More buyers are involved in the business buying decision and business buyers are better trained and more professional than are consumer buyers. In general, business purchasing decisions are more complex, and the buying process is more formal than consumer buying.