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Factors Influencing Organisational Buying Decisions in the Manufacturing Industry: Are Products and Services Procurement Different?

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  • Ćorić Dubravka Sinčić

    (Faculty of Economics and Business, University of Zagreb, Zagreb, Croatia.)

Abstract

The paper explores factors influencing services procurement decision-making of manufacturing companies, and compares it to factors influencing products procurement decision-making. Data were gathered by survey among manufacturing companies and analysed by using exploratory factor analysis. The comparison between factors influencing services procurement and factors influencing products procurement is made by content analysis. Results prove that six distinct factors influence manufacturing companies when making services procurement decisions: interdepartmental communication, trust in service provider, service provider flexibility, buyer’s price sensitivity, top management support, and service provider competence. When compared to products procurement situation, it can be observed that some of the factors are influential in both purchasing situations, whereas other factors are not similarly important in both purchasing situations. The paper offers an insight to factors influencing buying decisions of manufacturing companies, that can help selling companies to better understand the differences in procurement processes of manufacturing companies in two buying situations: products procurement vs. services procurement.

Suggested Citation

  • Ćorić Dubravka Sinčić, 2021. "Factors Influencing Organisational Buying Decisions in the Manufacturing Industry: Are Products and Services Procurement Different?," Zagreb International Review of Economics and Business, Sciendo, vol. 24(1), pages 99-111.
    • Handle: RePEc:vrs:zirebs:v:24:y:2021:i:1:p:99-111:n:1005
    DOI: 10.2478/zireb-2021-0005
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    References listed on IDEAS

    as
    1. Fredrik Nordin & Henrik Agndal, 2008. "Business service sourcing: a literature review and agenda for future research," International Journal of Integrated Supply Management, Inderscience Enterprises Ltd, vol. 4(3/4), pages 378-405.
    2. Lewin, Jeffrey E. & Donthu, Naveen, 2005. "The influence of purchase situation on buying center structure and involvement: a select meta-analysis of organizational buying behavior research," Journal of Business Research, Elsevier, vol. 58(10), pages 1381-1390, October.
    3. Ho, William & Xu, Xiaowei & Dey, Prasanta K., 2010. "Multi-criteria decision making approaches for supplier evaluation and selection: A literature review," European Journal of Operational Research, Elsevier, vol. 202(1), pages 16-24, April.
    4. Moon, Junyean & Tikoo, Surinder, 2002. "Buying decision approaches of organizational buyers and users," Journal of Business Research, Elsevier, vol. 55(4), pages 293-299, April.
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    More about this item

    Keywords

    Organisational buying behaviour; Products procurement; Services procurement; Manufacturing companies; Factor analysis;
    All these keywords.

    JEL classification:

    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • L84 - Industrial Organization - - Industry Studies: Services - - - Personal, Professional, and Business Services
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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