Question

Brittni is an account executive for a financial services firm that specializes in employee benefits services. She is meeting with the owner of a small business who has grown to the level where he needs to provide extended employee benefits to be in compliance with the Affordable Care Act. In the past, the small business provided a small stipend to employees to cover some of their insurance costs, but they now must offer comprehensive health-care insurance coverage or face a fine. Brittni is happy to help the small business owner and is excited about the opportunity to gain another customer. The company owner has purchased other insurance services such as property and casualty for the business, but has never purchased a group insurance plan and anticipates that it will take a considerable amount of time in the purchase process since this represents a significant decision for the company and its employees. What type of business purchase does this represent?

Answer 1

Answer:

New task purchase

Explanation:

New task purchase is the one purchase decision that has not been done previously by the business as they did not have the need for a new product/task. The new purchase is different from re-purchase as a new purchase will require a lot of evaluation from the buyer both for the product they intend to purchase and the vendor that they want to purchase from. New task purchase is usually done by a company when a need is recognized within the organization. This need may come internally from the firm or may have come from externally (e.g. clients).

After the need is recognized the company tries to evaluate several products that can satisfy this need and also looks for consultants/vendors that can provide solutions for the need. During this process a company will look at several vendors and evaluate them for their capabilities to serve the product/service. After the initial qualification check the company asks all the eligible suppliers/vendors to submit their bids (also called the tendering process).

After evaluation of the bids the firm may decide to purchase the product/service from any of the vendor which suits its needs best. Many companies usually go for the lowest price bids when there is no difference in the product of different supplier and the purchase decision is made.

After the purchase decision the companies usually re-evaluate their purchases and then decide about the future purchases of similar product.