The business market consists of all business users, organizations that buy goods and services for one of the following purposes:
(i) To make other goods and services. FFF buys wood to make furniture.
(ii) To resell to other business users or to consumers.
(iii) To conduct the organization’s operations. The Obafemi Awolowo University buys office supplies and electronic office equipment for use in registrar’s office, and her Teaching Hospital buys supplies to use in the surgical operating rooms.
In the business market we deal with both consumer products and business products.
Business marketing, then, is the marketing of goods and services to business users, as contrasted to ultimate consumers.
About 50 percent of all manufactured products are sold to the business market. In addition, about 80 percent of all farm products and virtual y all minerals, forest and sea products are business goods. These are sold to firms for further processing.
Every retail store and wholesaling establishment is a business user. Every bus company airline, and railroad is part of this market. So is every hotel, restaurant, bank, insurance company, hospital, theater and school.
COMPONENTS OF THE BUSINESS MARKET
Traditionally, business markets were referred to as industrial markets. Manufactures constitute a major portion of the business market, but there are also six other components, agriculture, resellers, government agencies, service companies, nonprofit organizations and international.
THE AGRICULTURE MARKET
The high level of income from the sale of agriculture products gives farmers, as a group, the purchasing powers that make them a highly attractive market. Moreover, world population forecasts and food shortages in many countries undoubtedly will keep pressure on farmers to increase their output.
Agribusiness: farming, food processing, and other large-scale farming-related business, is big business in every sense of the word.
Agriculture has become a modern industry. Like other business executives, farmers are looking for better ways to increase their productivity, cut their expenses
THE RESELLER MARKET
Intermediaries constitute the reseller market. The basic activity of resellers, unlike any other business market segment- is buying products from supplier organizations and reselling these items in essential y the same form to the resellers’ customers. In economic terms, resellers create time, place and possession utilities, rather than form utility.
It is their role as buyers for resale that differentiates resellers and attracts special marketing attention from their suppliers. To resell an item, you must please your customer. Do you know that it is more difficult to determine what will please an outside customer than to find out what will satisfy someone within your own organization?.
THE GOVERNMENT MARKET
The government market includes Federal, state, and local government units
that spend billions of naira a year buying for government institutions such as schools, offices, hospitals and military bases.
Government procurement processes are different from those in the private sector of the business market. Try to support this statement by finding out how governments make their purchases in at the various ministries and parastatals.
THE SERVICES MARKET
THE “NON-BUSINESS” BUSINESS MARKET
The non-business market includes such diverse institutions as churches, colleges and universities, museums, hospitals and other health institutions. Political parties, labour unions, and charitable organizations. Actual y, each of these so-called non-business organizations is a business organization. These organizations do virtual y all the things that business do — offer a product, collect money, make investments, hire employees -and therefore require professional management.
Nonprofit organizations also conduct marketing campaigns, in an effort to attract millions of Naira in contributions. In turn, they spend millions of Naira buying goods and services to run their operations. When you look closely at your NGOs, your church or mosque you will tend to agree to the fact that they are business organizations.
