There are two main types of buyers. Wholesale buyers purchase merchandise directly from manufacturers and resell it to retail firms, commercial establishments, and other institutions. Retail buyers purchase goods from wholesalers (and occasionally from manufacturers) for resale to the general public. In either case, buyers must understand their customers’ needs and be able to purchase goods at an appropriate price and in sufficient quantity. Sometimes a buyer is referred to by the type of merchandise purchased—for example, jewelry buyer or toy buyer. Government buyers have similar responsibilities but need to be especially sensitive to concerns of fairness and ethics since they use public money to make their purchases. There are approximately 520,000 buyers and related workers currently working in the United States.
Buyers Job Description
Wholesale and retail buyers are part of a complex system of production, distribution, and merchandising. Both are concerned with recognizing and satisfying the huge variety of consumer needs and desires. Most specialize in acquiring one or two lines of merchandise.
Retail buyers work for retail stores. They generally can be divided into two types: The first, working directly under a merchandise manager, not only purchases goods but directly supervises salespeople. When a new product appears on the shelves, for example, buyers may work with salespeople to point out its distinctive features. This type of retail buyer thus takes responsibility for the products’ marketing. The second type of retail buyer is concerned only with purchasing and has no supervisory responsibilities. These buyers cooperate with the sales staff to promote maximum sales.
All retail buyers must understand the basic merchandising policies of their stores. Purchases are affected by the size of the buyer’s annual budget, the kind of merchandise needed in each buying season, and trends in the market. Success in buying is directly related to the profit or loss shown by particular departments. Buyers often work with assistant buyers, who spend much of their time maintaining sales and inventory records.
All buyers must be experts in the merchandise that they purchase. They order goods months ahead of their expected sale, and they must be able to predetermine marketability based upon cost, style, and competitive items. Buyers must also be well acquainted with the best sources of supply for each product they purchase.
Depending upon the location, size, and type of store, a retail buyer may deal directly with traveling salespeople (ordering from samples or catalogs), order by mail or by telephone directly from the manufacturer or wholesaler, or travel to key cities to visit merchandise showrooms and manufacturing establishments. Most use a combination of these approaches.
Buying trips to such cities as New York, Chicago, and San Francisco are an important part of the work for buyers at a larger store. For specialized products, such as glassware, china, liquors, and gloves, some buyers make yearly trips to major European production centers. Sometimes manufacturers of similar items organize trade shows to attract a number of buyers. Buying trips are difficult; a buyer may visit six to eight suppliers in a single day. The buyer must make decisions on the spot about the opportunity for profitable sale of merchandise. The important element is not how much the buyer personally likes the merchandise but about customers’ taste. Most buyers operate under an annual purchasing budget for the departments they represent.
Mergers between stores and expansion of individual department stores into chains of stores have created central buying positions. Central buyers order in unusually large quantities. As a result, they have the power to develop their own set of specifications for a particular item and ask manufacturers to bid on the right to provide it. Goods purchased by central buyers may be marketed under the manufacturer’s label (as is normally done) or ordered with the store’s label or a chain brand name.
To meet this competition, independent stores often work with resident buyers, who purchase merchandise for a large number of stores. By purchasing large quantities of the same product, resident buyers can obtain the same types of discounts enjoyed by large chain stores and then pass along the savings to their customers.
Because they work with public funds and must avoid any appearance of favoritism or corruption, government buyers sometimes purchase merchandise through open bids. The buyer may establish a set of specifications for a product and invite private firms to bid on the job. Some government buyers are required to accept the lowest bid. Each purchase must be well documented for public scrutiny. Like other types of buyers, government buyers must be well acquainted with the products they purchase, and they must try to find the best quality products for the lowest price.
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