1. Retail: Purchasing & Supply Chain
Management
The retail buying process and
buying for different types of
retail organisation

2. Learning objectives
At the end of this session students should be able to
• Describe the retail buying process
• Understand retail buying behaviour
• Identify some issues involved in buying for different
types of retail organisation

3. The retail buying process
• Industrial/organisational buying behaviour (OBB) is
more complex than consumer buying behaviour
• Retail Buyers obtain items for direct resale
• Retail buyers are intermediaries between producers
& consumers (rarely adapt product)
• Retail buyers need to understand consumer
behaviour (motivation & decision-making)

4. The retail buying process
• Who participates?
• What happens?
• What causes or influences a specific decision?
(Tanner, Industrial Marketing Management,1999)

5. The retail buying process
who participates?
OBB theory discusses a ‘buying centre’ or ‘decision
making unit’ (DMU) comprising:
• User – product is purchased on behalf of user
• Influencer – a specialist who advises on the problem
(e.g. technical, textile technologist, designer)
• Decider – has responsibility to purchase
• Buyer – involved in day to day activity (might also be
the decider)
• Gatekeeper – information on issues such as products
or markets distributed via gatekeeper

6. The retail buying process
What happens?
A suggested staged process undertaken before a buying
decision is made (the ‘buy-phases’)
• Recognition of retail customer need
• Write specification of product to satisfy need
• Search for a supplier that can produce a product
which meets specification
• Choose supplier that meets supply requirements
• Specify the order (time, quantity, delivery)
• Evaluate performance of product and supplier

7. The retail buying process
What causes or influences the OBB decision?
Personal (buyer’s values &
beliefs)
Interactional including potential
suppliers
Organisational influences on
the buyer
Macro-environmental

8. The retail buying process
organisational influences
• Size
• Product categories
• Organisational culture
• Organisational structure

9. The retail buying process
interactional influences
• Conflicts may exist in the buying centre / DMU (e.g.
buyer v designer, differential status i.e. seniority of
roles)
• Buyer’s company and supplier

10. Variations in the Buyer’s role
‘The buyer may be responsible for the purchase
of a comparatively small range of merchandise
or for several complete departments, depending
on the size and type of the retail organisation.’
(Source: Cox & Brittain)

11. The role of the Retail Buyer
The role of a buyer varies depending on the type of
organisation for which they are buying.
In small companies the owner/manager is often
responsible for purchasing, together with other
aspects of the business (marketing, merchandising
etc.)
Larger companies will have a specialist team working in
this area. The large companies with more diverse
assortments are likely to have larger teams of buyers
ensuring greater knowledge and control.

12. Centralised / Decentralised Buying
The benefit of having one buyer for the whole store is
that:
‘consistency within the merchandise mix will be
maximised’
The benefit of having a number of specialist buyers is
that:
‘greater knowledge and control of merchandise can
be developed and maintained’
(Source: Cox & Brittain)

13. Seminar
• Exercise: desirable attributes of retail buyers
• Reading: Varley cpt. 1