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Chapter 08 - Understanding Customers: Business to Business Markets
Chapter 08
Understanding Customers: Business to Business Markets
True / False Questions
1. The value propositions required to compete and market in B2B versus B2C are often the
same.
True False
2. While many companies operate in the business-to-consumer markets, all companies operate
in a business-to-business market.
True False
3. B2B companies often have a few companies that represent a large portion of their sales.
This means that losing one larger customer has striking implications for the company.
True False
4. Customers in the B2B market place demand not only a personal relationship with their
vendors but also an efficient one.
True False
5. The consumer buying process takes longer and is more complex than the B-to-B buying
process.
True False
6. Business markets tend to concentrate in certain locations in the United States as a result of
suppliers wanting to be located close to one another.
True False
8-1
7. The goal of business sellers in straight re-buy situations is to become the preferred supplier.
Companies not on the approved list of suppliers are called out suppliers.
True False
8. A Buying Center is a permanent group of people at a B2B company that decides on each
new purchasing decision. It is most common for only one buying center to exist at any time in
a company.
True False
9. Users in the buying process have enhanced responsibilities in new purchase and modified
re-buy situations when product specifications are being set for the purchase decision.
True False
10. Influencers are any individuals, both inside and outside the organization, with relevant
expertise in a particular area that is used by the buying center in making the final decision.
True False
11. One of the toughest challenges facing salespeople in a new or modified re-buy situation is
getting access to the right people.
True False
12. The people in a company blocking access to key personnel in the buying process are
called Goalies.
True False
13. Deciders can be come from a variety of roles in the organization. For example, they can
be a CEO, a CFO, the head of the buying center, or can be a group coming to a consensus on
a particular purchase.
True False
8-2
14. The NAICS codes list all of a particular companies business sectors. A company can be
listed in several different categories.
True False
15. There are two types of end user purchases-capital equipment and sundries.
True False
16. It is best for a company looking for or maintaining a strategic relationship with a client if
their sales team is involved with the creation of an RFP with the client.
True False
17. It is often the case that the purchase decision itself in the B2B market involves trade-offs
between equally important evaluation criteria and equally qualified vendors.
True False
18. Intel built a chip fabrication plant in China that serves two purposes. One is to show its
commitment to China and the other is to give Intel strategic advantage over competition that
does not manufacture there.
True False
19. Risk tolerance is an organizational factor that differs among companies trying to decide on
a particular vendor.
True False
20. Dealing with complaints, resolving customer problems and making sure the company is
meeting customer expectations are critical to ensuring customer satisfaction in the B2B
market.
True False
8-3
Multiple Choice Questions
21. B2B is strategically important to companies like Bright House Networks in that it offers
_____ average revenue per user than B2C.
A. Lower
B. Higher
C. The same
D. Uneven
E. Symmetrical
22. The value propositions required to compete and market in the B2B versus the B2C
industries are often:
A. The same
B. Similar but with a business tilt
C. Quite different
D. Pluralistic
E. None of the above
23. A characteristic of B2B companies is that they often make products that end up as
___________ in a finished product.
A. components
B. labels
C. minor features
D. major features
E. factoids
24. Many manufacturers, such as Sharp Electronics, focus on the B2C market but have a
significant level of sales in:
A. The music market
B. The supply chain market
C. The quick sale market
D. The B2B market
8-4
25. Business-to-business markets are:

A. Identical to business-to-consumer markets
B. Similar in most ways to business-to-consumer markets
C. Different in several ways to business-to-consumer markets
D. Different in every way from business-to-consumer markets
E. All of the above
26. The nature of business-to-business markets requires:

A. A more personal relationship between the buyer and seller.
B. Invest more resources to foster and maintain personal contact
C. May even invest in their suppliers in order to strengthen the relationship
D. All of the above
27. Technology plays ____________ type of role in connecting buyers and sellers together in
the B2B market:
A. The same role as B2C markets
B. A critical role in connecting buyers and sellers
C. A lower level role than B2C markets
D. A decreasing role in connecting buyers and sellers
E. No role in connecting buyers and sellers
28. The buying process for B2B markets ___________ than B2C markets.
A. Is more complex
B. Is more circuitous
C. has fewer people involved
D. is more psychological in nature
E. all of the above
29. B2C markets can be characterized as being more ________ than B2B markets.
A. Conservative
B. Liberal
C. Impersonal
D. Personable
E. Likeable
8-5
30. It is said that B2B demand is more _____________ in general than B2C demand for
products or services.
A. Elastic
B. Bimodal
C. Inelastic
D. Systemic
31. A supply chain is ________________________.

A. The synchronized movement of goods through the channel
B. The lack of co-ordinate movement of goods from supplier to user
C. The financial chain that leads from consumer to the producer
D. The sequence of movements coordinated through air space
E. The collegial relationship between two groups of suppliers
32. The relationship between consumer demand for products and demand for B-to-B products
is said to be _______________.
A. Upward sloping demand
B. Downward sloping demand
C. Derived demand
D. Equal demand
E. All of the above
33. Small changes in consumer demand can lead to considerable shifts in business product
demand and it referred to as the ____________.
A. Deceleration effect
B. Transverse effect
C. Modified effect
D. Acceleration effect
8-6
34. Business-to-business demand is said to be relatively inelastic. This means that

_________.
A. As the price increases demand goes up
B. Changes in demand are not significantly affected by the price
C. As demand goes down price goes down with it
D. Demand and supply are independent of each other
35. Many companies use environmental scanning in order to identify things that may have
__________.
A. A long term affect on consumer demand
B. A short term affect on consumer demand
C. A negative affect on consumer demand
D. A positive affect on consumer demand
E. All of the above
36. Boeing has taken steps to build consumer demand for its new 787 Dreamliner although it
only sells the plane to B2B customers. This is an example of ________.
A. Inelastic demand
B. Elastic demand
C. Codependent demand
D. Derived demand
E. Fluctuating demand
37. When you re-order products that are used on a consistent basis, it is called a ________.
A. Purchase
B. Order on demand
C. Two-bin inventory system
D. Modified order on demand
E. Straight rebuy
8-7
38. A straight rebuy is:

A. Re-order products that are rarely used
B. Put re-orders into a buying center to reconsider the supplier
C. Re-order products that are used on a consistent basis
D. Develop a list of suppliers to rank them by price
39. The three main types of buying situations can be characterized as ___________.
A. Straight rebuy, mid-level rebuy and new purchase
B. Straight rebuy, modified rebuy and new purchase
C. Slight rebuy, non-evaluative rebuy and new purchase
D. Buy, rebuy and non-buy
40. When General Motors is familiar with a product and supplier, but still seeks additional
information in the market place, it is called a ________.
A. Straight rebuy
B. Modified rebuy
C. New purchase
D. Filtered buy
41. Moore Diversified Services decides to create a group that is made up of people from the
purchasing department, senior management with financial knowledge, and engineers with
design expertise. It is common for this group to be called _________.
A. Ad hoc group
B. Party planners
C. Selling partners
D. Buying center
E. Post hoc group
8-8
42. Jose is the machine press operator in a small manufacturing facility. He has been on the
job for 7 years and taken extensive training courses with respect to his machine. Jose plays the
role of __________ in the buying process.
A. Influencer
B. User
C. Decider
D. Operator
E. Key holder
43. In the buying process the "user" is characterized as __________________.

A. The actual consumer of the product
B. The actual leader of the buying group
C. The actual evaluator of the product
D. The consultant to the buying group
44. An Initiator is ____________.

A. Any person who starts the purchase process
B. Senior executive that makes a decision that require new resources
C. A "user" who re-orders when supplies run low
D. All of the above
45. Gatekeepers are important in the B2B buying process because ____________.
A. They limit the number of vendors in a given buying process
B. Engineering and quality control create product specifications that block vendors
C. They control access to key people
D. All of the above
8-9
46. Deciders are an important group for the salesperson to be able to identify because
________.
A. They make the ultimate purchase decision
B. They decide what characteristics the product should possess
C. They decide what price the company should pay
D. They have sole control over who is allowed to be a vendor
47. In the buying process there is one group that can play a critical role. This group is often
the first to recognize the problem based on a need and they help define the product
specifications. This group is called ___________.
A. Deciders
B. Gatekeepers
C. Users
D. Influencers
E. Buyers
48. Derek Barber is working on selling some defense equipment to Buccaneer Supply
Company. After getting by the secretary, he decides to talk to people inside the firm to
identify people that he considers to be important in the buying center process. The people he
is targeting are known as __________.
A. Influencers
B. Users
C. Gatekeepers
D. Initiators
E. Product engineers
49. Gatekeepers are important to the buying process because they _________.
A. Control the contract in the buying center
B. Have position power in the organization
C. Control access to key participants in the buying center
D. Control access to the building site of the buying center
E. All of the above
8-10
50. Jefferson Wainright is happy over the growth of the company. As manager of production
floor he wants to expand with another workstation to increase the capacity of the floor.
Jefferson creates a buying center to evaluate various combinations of machines for the new
station. The buying center gives him a list of the machine preferences ordered from 1 to 3.
After reviewing the list, he orders machine 2 due to the past experience with the
manufacturer. Jefferson is playing the role of a _________.
A. Gatekeeper
B. Manager of purchasing
C. Influencer
D. Manager of the floor
E. Decider
51. Hoffman Dirkbond is senior executive in manufacturing. He has been concerned about the
age of the equipment and decides to do a study to evaluate the time and money lost due to
equipment failure. He decides to bring his research to the monthly board meeting. In this way
Dirkbond is playing the role of ___________ in the buying process.
A. Gatekeeper
B. Initiator
C. User
D. Decider
52. Maryanne has noticed that the production of one of the manufacturing teams has lost
productivity over a six month period of time. She puts together a document that describes the
productivity loss and does a study to determine the cause. She finds that one of the key
machines in the process breaks down often. Maryanne asks several machine manufacturers to
come into the company and make proposals. Maryanne is playing the role of ________.
A. Influencer
B. Gatekeeper
C. Initiator
D. User
E. Decider
8-11
53. Sam Celeski is a salesman with an industrial supply house. He discovers that Ingersoll
Rand is going to make a large purchase of equipment and has created a Buying Center to get
the purchase done. Sam's first job is to _______________.
A. Discover the budget for the purchase
B. Develop criteria for the purchase
C. Discover the most important influencer
D. Discover who is part of the buying center
E. Develop a presentation for the buying center
54. NAICS codes now include __________.

A. USA
B. USA and Canada
C. USA, Canada, and Mexico
D. All of the Americas, North and South
E. All of the Americas and the Caribbean Basin
55. With respect to Buying Centers ____________.

A. It is easy to identify the roles people play in the center
B. The most important people are users and influencers
C. Gatekeepers must be understood by the salesperson
D. Deciders usually identify themselves to vendors
56. NAICS codes are a classification of businesses that ___________.

A. List the primary output of the business
B. Each company gets only one code
C. Are used across the US, Mexico and Canada
D. Defines 20 major business sectors
E. All of the above
8-12
57. MRO supplies, materials, repairs and operational supplies and services, are generally
purchased through a ______________.
A. Buying center
B. Buying committee
C. Bid at time of need
D. Straight re-buys
E. Contractual liturgy
58. Companies like Home Depot do business in the B2B market and B2C market out of the
same store. This puts them in the category of businesses called _________.
A. Mixed use enterprise
B. Resellers
C. Value added enterprise
D. Retail merchandiser
E. End sellers
59. Resellers are important to marketers because ______________.

A. They have their own buying centers that service customers
B. They buy equipment and supplies to run their own business
C. They serve as an early warning system to OEM's
D. All of the above
60. The single largest buyer of goods and services in the world is ____________.
A. General Electric
B. Wal-Mart
C. United States Government
D. Russian Government
8-13
61. The primary difference between selling to the profit-oriented market and the nonprofit
market is ______________________.
A. Non-profits use a buying triad instead of a buying center
B. The profit sector pools their money for purchases
C. The vendor list is shorter in the non-profit sector
D. Non-profits have a limited number of resources compared to their profit counterparts
E. All of the above
62. The business market purchase decision process is triggered by someone inside the
company who _____________.
A. Runs out of office supplies
B. Needs a copy and no machine is available
C. Identifies a need
D. Attends a meeting to brainstorm
63. Problem recognition for the business market consumer is triggered by ________.
A. Running out of stock
B. Seeing a new product on television
C. Someone inside or outside the company identifies a need
D. All of the above
64. There are at least two methods to build a list of potential suppliers once product
specifications have been outlined. One of the methods is to use the cumulative experience of
the company over time. The second method is _______.
A. Buying a list from a list broker
B. Use supplier search websites like Thomas Global Register
C. Ask all sales people to respond to the RFP
D. Create a list from the Yellow Pages
E. Go to several trade shows and find suitable suppliers
8-14
65. Not all problems identified by a company necessarily lead to a purchase. The solution may
include ___________________.
A. Improvement in systems
B. Working with employees to get better efficiency
C. Shortage of employees
D. Improved training for new hires
E. All of the above
66. Request for proposal (RFP) is the process of ___________.

A. Getting people to lower the price
B. Achieving strategic advantage over competition
C. Excite suppliers to join our supply chain
D. Putting product specifications into a document for distribution
67. A request for proposals (RFP) ____________________.

A. Is the end point for vendors in the B2B market
B. Is the starting point from which vendors put together their product solution
C. Companies should not bother to bid if they can not meet all of the RFP guidelines.
D. Is not a very time consuming part of the sales process
68. When a company solicits RFP's from suppliers with an open vendor search, the goal is to
__________________.
A. Get several proposals in order to help with negotiations
B. Get one good response from our preferred vendor
C. Get as many responses so the firm can focus only on price
D. Get proposals in order to get competitive intelligence
E. All of the above
8-15
69. When responding to a RFP the B2B marketer may __________.

A. Use CRM or custom software to make all proposals look uniform
B. Assign it to one person in the organization
C. Give the same proposal to all prospective clients
D. Let only the sales team read the proposal
70. When a marketing company responds to an RFP, _____________.

A. It presents clearly how the marketing company's products will meet the product
specifications detailed in the RFP.
B. It makes a case for selecting the marketing company by presenting any additional
information such as unique product features it possesses.
C. It succinctly presents the superior service of the marketing company.
D. All of the above
71. Complex product choice (Did we make the best selection?) in the B2B market depends
upon __________________.
A. Price, product, and distribution criteria
B. Financial, subjective and objective criteria
C. Objective, subliminal and price criteria
D. Financial, value and service criteria
72. Industrial sellers often include with the RFP a ________.

A. Strong financial analysis of the purchase
B. Strong request to be the sole source for the contract
C. Financial incentives to make the purchase in the form of discounts
D. Financial incentives to make the purchase in the form of free service
8-16
73. A big industrial firm is interested in evaluating the potential purchase of a machine. In
order to do this, managers should look at ___________.
A. True cost
B. Total purchase price
C. Total costs over the life of the machine
D. Cost plus insurance on the machine
E. Cost plus the service contract on the machine
74. Financial criteria in the purchase of a complex product for the business market include
__________________.
A. All costs evaluated against the stated life of the product
B. All costs evaluated for one year
C. All costs evaluated for 5 years
D. The time it takes to pay off the loan
75. Sellers are well aware that industrial buyers of products __________________.
A. Need only the highest quality products
B. Need a high and a low level of quality products
C. Need a selection of products with different qualities and price levels
D. Need only low priced products
76. Southwest Airlines is a good example of the concept of service criteria because ______.
A. It flies a variety of planes made by only Boeing
B. It minimize service costs by having untrained employees performing routine maintenance
C. Its service terminals are in low cost parts of the country
D. It flies only Boeing 737's so maintenance crews need to know only one plane.
8-17
77. The most fundamental criterion in vendor selection is ____________.

A. Serviceability
B. Price
C. Reliability
D. Location
E. Intangibility
78. Intel demonstrated their commitment to China by ____________.

A. Making China a key supplier of chips
B. Opening a new plant in China
C. Giving China the product specifications for the most advanced chips
D. Giving China the best price on the latest chips
E. All of the above
79. A fundamental criterion in vendor selection is the vendor's ability to meet contractual
obligations including delivery times and service schedules. This concept is called ______
A. Supplier choice
B. Dependability
C. Reliability
D. Sustainability
80. Accountants, purchasing agents, engineers, and other players in a buying center perceive
the evaluation of products in different ways which makes a buying center:
A. Less effective than a center handled only by purchasing
B. More effective since individuals with different perspectives gives a well-rounded view of
the purchase decision.
C. Chaotic since there are so many different view points for a product evaluation
D. All of the above
8-18
81. Once a purchase decision is made, the sales process continues and is called
_____________.
A. Cognitive dissonance
B. Purchase evaluation process
C. Post mortem analysis
D. Post purchase evaluation
82. Any influence on the product and supplier choice is an organizational factor. The primary
organizational factor is _________.
A. Needs and desires of those involved
B. Opportunity for promotion of the buying center manager
C. Product specifications
D. Financial considerations
E. Risk tolerance
83. Once a sale is made and the product delivered in the B2B market the buyer _____.
A. Evaluates the product and supplier in a post purchase process
B. Considers the sale complete
C. Looks for rapid installation of the product
D. Uses pert charts to evaluate time efficiencies
84. All companies lose customers periodically. Losing a customer can be difficult or it can
________________.
A. Be an epiphany
B. Be an episode of self-reflection
C. Be an opportunity to reacquire customers
D. Be an excuse to let people go
E. Be lead to lower prices because of pressure from the sales force
8-19
85. EDI (electronic data interchange) allows _________.

A. Companies to talk to each other daily
B. Customer computers to communicate directly with supplier computers
C. Computers to fulfill the buying center function
D. Computers to do complex product evaluation with limited human involvement
E. All of the above
86. B-to-B transactions have been growing at a phenomenal rate. On-line B-to-B sales
worldwide is now in excess of ______________.
A. $100 million dollars
B. $500 million dollars
C. $1 billion dollars
D. $1 trillion dollars
87. One of the benefits of electronic data interchange (EDI) is ________

A. Customer computers communicate directly with supplier computers
B. Suppliers can listen in on buyers
C. Buyers get better prices than ever before
D. Late deliveries are less common
E. Technology linkages are more plentiful
88. The process of business purchasing on-line is called _____________.

A. Fast procurement
B. Channel management
C. E-procurement
D. Team procurement
E. Effective procurement
8-20
89. Many companies have set up direct links to approved supplier to make the purchase easier
and move it closer to the front line decision makers. These direct links are called
_________________.
A. Internet connections
B. Google B2B
C. Intranet
D. Extranet
E. T-lines of connection
90. Office Depot has a number of direct relationships using EDI with thousands of companies.
This relationship is done through a concept called ____________.
A. Extranet
B. Intranet
C. Electronic impact analysis
D. Utility functionality
E. Quick response program
Short Answer Questions
91. In B2B marketing, companies rely on a more personal relationship between the buyer and
seller, how does this differ from consumer marketing?
92. Within the organization, who is the person most responsible for maintaining B2B
relationships? Why?
8-21
93. Why does technology play a critical role in connecting the buyer and the seller in the B2B
market?
94. Business markets are characterized by fewer, but larger customers, how does this affect
customer retention?
95. Why is geographic concentration an important part of some B2B relationships?
96. Define supply chain?
8-22
97. How has the demand for biofuels affected the demand for corn?
98. Why is the demand for products and services different in a business market?
99. Las-X makes medical lasers used in hair removal and cosmetic surgery. The company
recognizes that consumers have less disposable income now than they did just a few years
ago. Who are customers for Las-X and how does consumer demand impact Las-X? What
demand concept is illustrated here?
100. Kiran runs Power3, a specialized battery manufacturer. His biggest account is an
international digital camera manufacturing company. Kiran would like to increase sales and
believes that if he lowers the price of his lithium batteries he will receive larger orders from
the digital camera manufacturer. What would you tell Kiran about the demand for his
product?
8-23
101. Why is a new purchase the most difficult buying situation?
102. Why is the buying center an important part of the purchasing decision?
103. Lucy is executive assistant to Doug Belden, the C.E.O, at Belden & Belden Office
Supply. Since Mr. Belden makes most final decisions in regards to purchasing decision, Lucy
is a key member of the buying center process. Recently Lucy has received information from a
new salesperson for one of their key suppliers, she is now deciding whom to send the
information to within the organization. What member of the buying center process is Lucy?
What member of the buying center process is the Mr. Belden?
104. How does the North American Industrial Classification System (NAICS) help in B2B
marketing?
8-24
105. Making Waves Boating has just returned from a trade show where managers purchased
ten new boats and multiple boating accessories. Making Waves already has promised five of
the boats to a local resort, and by Monday the remaining new items will be on the showroom
floor ready for purchase. In a B2B market what would Marking Waves be labeled as a seller?
Why?
106. How do government purchase practices differ from other B2B purchase practices?
107. Tyrone owns Orchid Odyssey a plant nursery that specializes in orchids. Tyrone has had
significant success with his Orchid of the Month mail order program, and as a result needs
larger nursery space. What part of the business market purchase decision process has Tyrone
just illustrated? What will he need to do next?
108. When making a product selection as part of the business market purchase decision
process, what three primary criteria are used to make a decision?
8-25
109. Businesses understand that supplier qualifications are a main part of the purchase
decision. What are the main criteria the supplier choice decision and what to they represent?
110. Why is it so important for the buyer and seller to participate in the post-purchase
evaluation of a product and supplier?
111. Maureen runs a hospital in a metropolitan area, she believes that the hospital should
implement an electronic data interchange (EDI) system, but she is meeting some resistance.
What would you tell some of the people that are resisting the EDI system?
Essay Questions
112. In B2B markets, relationships and technology are increasingly important. Describe the
role of each.
8-26
113. Katherine is the marketing VP for a cleaning supply manufacturer. The firm's products
are proven to kill 99% of bacteria. The current target market of hospitals and skilled nursing
facilities. Katherine is considering branching into the consumer products market and wants
your advice on the five major differences in business and consumer markets. What do you say
to her?
114. Victor has just transitioned from working in a primarily consumer driven market to
working in a B2B market. His company manufactures headlights for various vehicles. Victor's
business partner believes they need to move their production plant closer to their major
customers, Victor believes they can continue to operate as they always have. Who is right?
Why?
115. Rosa, a marketing consultant, is preparing a report for a client that produces lumber for
use in the housing market. She is writing a section on market demand and needs to explain the
three types of demand. How should she explain this to her client?
8-27
116. Scampi Seafood processes fresh shrimp and fish caught off the coast of Louisiana. The
company wants to build another processing plant in Texas. Utilizing your knowledge of the
B2B purchasing process, explain how straight rebuy, modified rebuy and new purchase will
affect the purchasing of materials to build and open the new processing plant.
117. Antonio just graduated from the MBA program at this university and went to work at his
family's business, which is building custom wood furniture. He has finally convinced his
father that they need to upgrade the machinery they use to make the furniture and has started
to put together a buying center to make the purchase. His father doesn't think a buying center
is necessary and told Antonio to make the decision, what should Antonio say to his father
about the buying center? Whom should Antonio contact to be a member of the buying
center?
118. Kenny is the leading salesperson for Polymer Sci., a supplier specializing in polymers
used in manufacturing processes. He wants to find new customers so he has started to
research how to approach a buying center. What are some challenges that he will face?
8-28
119. Kari is the CEO of an up-and-coming new fashion label. She has just received a big
order and needs to obtain the necessary equipment and materials to be able to fulfill the order.
She has hired you, a business consultant, to assist her in making her decision. How would you
walk her through the business market consumer decision process?
120. You decided to open a sports bar with your best friend and are now trying to decide
between two suppliers. What do you consider when making your final decision?
121. Why is e-procurement play a larger role in B2B markets than in consumer markets?
What are some of the methods that have been put in place to make e-procurement ideal for the
B2B market?
8-29
Chapter 08 Understanding Customers: Business to Business Markets Answer

Key
True / False Questions
1. (p. 209) The value propositions required to compete and market in B2B versus B2C are often
the same.
FALSE
AASCB Standard: communication

Bloom's Taxonomy: knowledge
Difficulty: easy
Learning Objective: Recognize the importance of B2B marketing
2. (p. 211) While many companies operate in the business-to-consumer markets, all companies
operate in a business-to-business market.
TRUE

Difficulty: easy
3. (p. 212) B2B companies often have a few companies that represent a large portion of their
sales. This means that losing one larger customer has striking implications for the company.
TRUE

Difficulty: easy
Learning Objective: Understand the differences between B2C and B2B markets
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4. (p. 212) Customers in the B2B market place demand not only a personal relationship with
their vendors but also an efficient one.
TRUE

Difficulty: easy
5. (p. 213) The consumer buying process takes longer and is more complex than the B-to-B
buying process.
FALSE

Difficulty: easy
6. (p. 213) Business markets tend to concentrate in certain locations in the United States as a
result of suppliers wanting to be located close to one another.
TRUE

Difficulty: easy
7. (p. 217) The goal of business sellers in straight re-buy situations is to become the preferred
supplier. Companies not on the approved list of suppliers are called out suppliers.
TRUE

Difficulty: easy
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8. (p. 218) A Buying Center is a permanent group of people at a B2B company that decides on
each new purchasing decision. It is most common for only one buying center to exist at any
time in a company.
FALSE

Difficulty: easy
Learning Objective: Understand the critical role of the buying center and each participant in the B2B process
9. (p. 219) Users in the buying process have enhanced responsibilities in new purchase and
modified re-buy situations when product specifications are being set for the purchase
decision.
TRUE

Difficulty: easy
10. (p. 219) Influencers are any individuals, both inside and outside the organization, with
relevant expertise in a particular area that is used by the buying center in making the final
decision.
TRUE

Difficulty: easy
11. (p. 219) One of the toughest challenges facing salespeople in a new or modified re-buy
situation is getting access to the right people.
TRUE

Difficulty: easy
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12. (p. 219) The people in a company blocking access to key personnel in the buying process are
called Goalies.
FALSE

Difficulty: easy
13. (p. 219) Deciders can be come from a variety of roles in the organization. For example, they
can be a CEO, a CFO, the head of the buying center, or can be a group coming to a consensus
on a particular purchase.
TRUE

Bloom's Taxonomy: comprehension
Difficulty: easy
14. (p. 221) The NAICS codes list all of a particular companies business sectors. A company can
be listed in several different categories.
FALSE

Difficulty: easy
15. (p. 222) There are two types of end user purchases-capital equipment and sundries.
FALSE

Difficulty: easy
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16. (p. 225) It is best for a company looking for or maintaining a strategic relationship with a
client if their sales team is involved with the creation of an RFP with the client.
TRUE
AASCB Standard: analytic

Difficulty: moderate
Learning Objective: Learn the B2B purchase decision process and different buying situations
17. (p. 227) It is often the case that the purchase decision itself in the B2B market involves trade-
offs between equally important evaluation criteria and equally qualified vendors.
TRUE

18. (p. 229) Intel built a chip fabrication plant in China that serves two purposes. One is to show
its commitment to China and the other is to give Intel strategic advantage over competition
that does not manufacture there.
TRUE

19. (p. 230) Risk tolerance is an organizational factor that differs among companies trying to
decide on a particular vendor.
TRUE

Difficulty: easy
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20. (p. 230) Dealing with complaints, resolving customer problems and making sure the
company is meeting customer expectations are critical to ensuring customer satisfaction in the
B2B market.
TRUE

Difficulty: easy
Multiple Choice Questions
21. (p. 209) B2B is strategically important to companies like Bright House Networks in that it
offers _____ average revenue per user than B2C.
A. Lower
B. Higher
C. The same
D. Uneven
E. Symmetrical

Difficulty: easy
22. (p. 209) The value propositions required to compete and market in the B2B versus the B2C
industries are often:
A. The same
B. Similar but with a business tilt
C. Quite different
D. Pluralistic

Difficulty: easy
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23. (p. 210) A characteristic of B2B companies is that they often make products that end up as
___________ in a finished product.
A. components
B. labels
C. minor features
D. major features
E. factoids

Difficulty: easy
24. (p. 210) Many manufacturers, such as Sharp Electronics, focus on the B2C market but have a
significant level of sales in:
A. The music market
B. The supply chain market
C. The quick sale market
D. The B2B market

Difficulty: easy
25. (p. 211) Business-to-business markets are:

A. Identical to business-to-consumer markets
B. Similar in most ways to business-to-consumer markets
C. Different in several ways to business-to-consumer markets
D. Different in every way from business-to-consumer markets
E. All of the above

Difficulty: easy
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26. (p. 211) The nature of business-to-business markets requires:

A. A more personal relationship between the buyer and seller.
B. Invest more resources to foster and maintain personal contact
C. May even invest in their suppliers in order to strengthen the relationship
D. All of the above

Difficulty: easy
27. (p. 212) Technology plays ____________ type of role in connecting buyers and sellers
together in the B2B market:
A. The same role as B2C markets
B. A critical role in connecting buyers and sellers
C. A lower level role than B2C markets
D. A decreasing role in connecting buyers and sellers
E. No role in connecting buyers and sellers

Difficulty: easy
28. (p. 212) The buying process for B2B markets ___________ than B2C markets.
A. Is more complex
B. Is more circuitous
C. has fewer people involved
D. is more psychological in nature
E. all of the above

Difficulty: easy
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29. (p. 212) B2C markets can be characterized as being more ________ than B2B markets.
A. Conservative
B. Liberal
C. Impersonal
D. Personable
E. Likeable

Difficulty: easy
30. (p. 212) It is said that B2B demand is more _____________ in general than B2C demand for
products or services.
A. Elastic
B. Bimodal
C. Inelastic
D. Systemic

Difficulty: easy
31. (p. 213) A supply chain is ________________________.

A. The synchronized movement of goods through the channel
B. The lack of co-ordinate movement of goods from supplier to user
C. The financial chain that leads from consumer to the producer
D. The sequence of movements coordinated through air space
E. The collegial relationship between two groups of suppliers

Difficulty: easy
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32. (p. 215) The relationship between consumer demand for products and demand for B-to-B
products is said to be _______________.
A. Upward sloping demand
B. Downward sloping demand
C. Derived demand
D. Equal demand
E. All of the above

Difficulty: easy
33. (p. 215) Small changes in consumer demand can lead to considerable shifts in business
product demand and it referred to as the ____________.
A. Deceleration effect
B. Transverse effect
C. Modified effect
D. Acceleration effect

34. (p. 215) Business-to-business demand is said to be relatively inelastic. This means that
_________.
A. As the price increases demand goes up
B. Changes in demand are not significantly affected by the price
C. As demand goes down price goes down with it
D. Demand and supply are independent of each other

Difficulty: easy
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35. (p. 215) Many companies use environmental scanning in order to identify things that may
have __________.
A. A long term affect on consumer demand
B. A short term affect on consumer demand
C. A negative affect on consumer demand
D. A positive affect on consumer demand
E. All of the above

Difficulty: easy
36. (p. 215) Boeing has taken steps to build consumer demand for its new 787 Dreamliner
although it only sells the plane to B2B customers. This is an example of ________.
A. Inelastic demand
B. Elastic demand
C. Codependent demand
D. Derived demand
E. Fluctuating demand

Bloom's Taxonomy: application
Difficulty: easy
37. (p. 216) When you re-order products that are used on a consistent basis, it is called a
________.
A. Purchase
B. Order on demand
C. Two-bin inventory system
D. Modified order on demand
E. Straight rebuy

Difficulty: easy
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38. (p. 216) A straight rebuy is:

A. Re-order products that are rarely used
B. Put re-orders into a buying center to reconsider the supplier
C. Re-order products that are used on a consistent basis
D. Develop a list of suppliers to rank them by price

Difficulty: easy
39. (p. 216) The three main types of buying situations can be characterized as ___________.
A. Straight rebuy, mid-level rebuy and new purchase
B. Straight rebuy, modified rebuy and new purchase
C. Slight rebuy, non-evaluative rebuy and new purchase
D. Buy, rebuy and non-buy

40. (p. 217) When General Motors is familiar with a product and supplier, but still seeks
additional information in the market place, it is called a ________.
A. Straight rebuy
B. Modified rebuy
C. New purchase
D. Filtered buy

Difficulty: easy
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41. (p. 218) Moore Diversified Services decides to create a group that is made up of people from
the purchasing department, senior management with financial knowledge, and engineers with
design expertise. It is common for this group to be called _________.
A. Ad hoc group
B. Party planners
C. Selling partners
D. Buying center
E. Post hoc group

42. (p. 218) Jose is the machine press operator in a small manufacturing facility. He has been on
the job for 7 years and taken extensive training courses with respect to his machine. Jose plays
the role of __________ in the buying process.
A. Influencer
B. User
C. Decider
D. Operator
E. Key holder

43. (p. 219) In the buying process the "user" is characterized as __________________.
A. The actual consumer of the product
B. The actual leader of the buying group
C. The actual evaluator of the product
D. The consultant to the buying group

Difficulty: easy
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44. (p. 219) An Initiator is ____________.

A. Any person who starts the purchase process
B. Senior executive that makes a decision that require new resources
C. A "user" who re-orders when supplies run low
D. All of the above

Difficulty: easy
45. (p. 219) Gatekeepers are important in the B2B buying process because ____________.
A. They limit the number of vendors in a given buying process
B. Engineering and quality control create product specifications that block vendors
C. They control access to key people
D. All of the above

Difficulty: easy
46. (p. 219) Deciders are an important group for the salesperson to be able to identify because
________.
A. They make the ultimate purchase decision
B. They decide what characteristics the product should possess
C. They decide what price the company should pay
D. They have sole control over who is allowed to be a vendor

Difficulty: easy
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47. (p. 219) In the buying process there is one group that can play a critical role. This group is
often the first to recognize the problem based on a need and they help define the product
specifications. This group is called ___________.
A. Deciders
B. Gatekeepers
C. Users
D. Influencers
E. Buyers

48. (p. 219) Derek Barber is working on selling some defense equipment to Buccaneer Supply
Company. After getting by the secretary, he decides to talk to people inside the firm to
identify people that he considers to be important in the buying center process. The people he
is targeting are known as __________.
A. Influencers
B. Users
C. Gatekeepers
D. Initiators
E. Product engineers

49. (p. 219) Gatekeepers are important to the buying process because they _________.
A. Control the contract in the buying center
B. Have position power in the organization
C. Control access to key participants in the buying center
D. Control access to the building site of the buying center
E. All of the above

Difficulty: easy
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50. (p. 219) Jefferson Wainright is happy over the growth of the company. As manager of
production floor he wants to expand with another workstation to increase the capacity of the
floor. Jefferson creates a buying center to evaluate various combinations of machines for the
new station. The buying center gives him a list of the machine preferences ordered from 1 to
3. After reviewing the list, he orders machine 2 due to the past experience with the
manufacturer. Jefferson is playing the role of a _________.
A. Gatekeeper
B. Manager of purchasing
C. Influencer
D. Manager of the floor
E. Decider

51. (p. 219) Hoffman Dirkbond is senior executive in manufacturing. He has been concerned
about the age of the equipment and decides to do a study to evaluate the time and money lost
due to equipment failure. He decides to bring his research to the monthly board meeting. In
this way Dirkbond is playing the role of ___________ in the buying process.
A. Gatekeeper
B. Initiator
C. User
D. Decider

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52. (p. 219) Maryanne has noticed that the production of one of the manufacturing teams has lost
productivity over a six month period of time. She puts together a document that describes the
productivity loss and does a study to determine the cause. She finds that one of the key
machines in the process breaks down often. Maryanne asks several machine manufacturers to
come into the company and make proposals. Maryanne is playing the role of ________.
A. Influencer
B. Gatekeeper
C. Initiator
D. User
E. Decider

Difficulty: easy
53. (p. 220) Sam Celeski is a salesman with an industrial supply house. He discovers that
Ingersoll Rand is going to make a large purchase of equipment and has created a Buying
Center to get the purchase done. Sam's first job is to _______________.
A. Discover the budget for the purchase
B. Develop criteria for the purchase
C. Discover the most important influencer
D. Discover who is part of the buying center
E. Develop a presentation for the buying center

54. (p. 220) NAICS codes now include __________.

A. USA
B. USA and Canada
C. USA, Canada, and Mexico
D. All of the Americas, North and South
E. All of the Americas and the Caribbean Basin

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55. (p. 220) With respect to Buying Centers ____________.

A. It is easy to identify the roles people play in the center
B. The most important people are users and influencers
C. Gatekeepers must be understood by the salesperson
D. Deciders usually identify themselves to vendors

56. (p. 220-221) NAICS codes are a classification of businesses that ___________.
A. List the primary output of the business
B. Each company gets only one code
C. Are used across the US, Mexico and Canada
D. Defines 20 major business sectors
E. All of the above

Difficulty: easy
57. (p. 222) MRO supplies, materials, repairs and operational supplies and services, are generally
purchased through a ______________.
A. Buying center
B. Buying committee
C. Bid at time of need
D. Straight re-buys
E. Contractual liturgy

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58. (p. 222) Companies like Home Depot do business in the B2B market and B2C market out of
the same store. This puts them in the category of businesses called _________.
A. Mixed use enterprise
B. Resellers
C. Value added enterprise
D. Retail merchandiser
E. End sellers

59. (p. 222) Resellers are important to marketers because ______________.

A. They have their own buying centers that service customers
B. They buy equipment and supplies to run their own business
C. They serve as an early warning system to OEM's
D. All of the above

60. (p. 223) The single largest buyer of goods and services in the world is ____________.
A. General Electric
B. Wal-Mart
C. United States Government
D. Russian Government

Difficulty: easy
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61. (p. 223) The primary difference between selling to the profit-oriented market and the
nonprofit market is ______________________.
A. Non-profits use a buying triad instead of a buying center
B. The profit sector pools their money for purchases
C. The vendor list is shorter in the non-profit sector
D. Non-profits have a limited number of resources compared to their profit counterparts
E. All of the above

62. (p. 224) The business market purchase decision process is triggered by someone inside the
company who _____________.
A. Runs out of office supplies
B. Needs a copy and no machine is available
C. Identifies a need
D. Attends a meeting to brainstorm

63. (p. 224) Problem recognition for the business market consumer is triggered by ________.
A. Running out of stock
B. Seeing a new product on television
C. Someone inside or outside the company identifies a need
D. All of the above

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64. (p. 225) There are at least two methods to build a list of potential suppliers once product
specifications have been outlined. One of the methods is to use the cumulative experience of
the company over time. The second method is _______.
A. Buying a list from a list broker
B. Use supplier search websites like Thomas Global Register
C. Ask all sales people to respond to the RFP
D. Create a list from the Yellow Pages
E. Go to several trade shows and find suitable suppliers

65. (p. 225) Not all problems identified by a company necessarily lead to a purchase. The
solution may include ___________________.
A. Improvement in systems
B. Working with employees to get better efficiency
C. Shortage of employees
D. Improved training for new hires
E. All of the above

Bloom's Taxonomy: analysis
66. (p. 225) Request for proposal (RFP) is the process of ___________.
A. Getting people to lower the price
B. Achieving strategic advantage over competition
C. Excite suppliers to join our supply chain
D. Putting product specifications into a document for distribution

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67. (p. 225) A request for proposals (RFP) ____________________.

A. Is the end point for vendors in the B2B market
B. Is the starting point from which vendors put together their product solution
C. Companies should not bother to bid if they can not meet all of the RFP guidelines.
D. Is not a very time consuming part of the sales process

68. (p. 227) When a company solicits RFP's from suppliers with an open vendor search, the goal
is to __________________.
A. Get several proposals in order to help with negotiations
B. Get one good response from our preferred vendor
C. Get as many responses so the firm can focus only on price
D. Get proposals in order to get competitive intelligence
E. All of the above

69. (p. 227) When responding to a RFP the B2B marketer may __________.
A. Use CRM or custom software to make all proposals look uniform
B. Assign it to one person in the organization
C. Give the same proposal to all prospective clients
D. Let only the sales team read the proposal

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70. (p. 227) When a marketing company responds to an RFP, _____________.

A. It presents clearly how the marketing company's products will meet the product
specifications detailed in the RFP.
B. It makes a case for selecting the marketing company by presenting any additional
information such as unique product features it possesses.
C. It succinctly presents the superior service of the marketing company.
D. All of the above

71. (p. 227) Complex product choice (Did we make the best selection?) in the B2B market
depends upon __________________.
A. Price, product, and distribution criteria
B. Financial, subjective and objective criteria
C. Objective, subliminal and price criteria
D. Financial, value and service criteria

72. (p. 228) Industrial sellers often include with the RFP a ________.
A. Strong financial analysis of the purchase
B. Strong request to be the sole source for the contract
C. Financial incentives to make the purchase in the form of discounts
D. Financial incentives to make the purchase in the form of free service

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73. (p. 228) A big industrial firm is interested in evaluating the potential purchase of a machine.
In order to do this, managers should look at ___________.
A. True cost
B. Total purchase price
C. Total costs over the life of the machine
D. Cost plus insurance on the machine
E. Cost plus the service contract on the machine

74. (p. 228) Financial criteria in the purchase of a complex product for the business market
include __________________.
A. All costs evaluated against the stated life of the product
B. All costs evaluated for one year
C. All costs evaluated for 5 years
D. The time it takes to pay off the loan

75. (p. 228) Sellers are well aware that industrial buyers of products __________________.
A. Need only the highest quality products
B. Need a high and a low level of quality products
C. Need a selection of products with different qualities and price levels
D. Need only low priced products

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76. (p. 228) Southwest Airlines is a good example of the concept of service criteria because
______.
A. It flies a variety of planes made by only Boeing
B. It minimize service costs by having untrained employees performing routine maintenance
C. Its service terminals are in low cost parts of the country
D. It flies only Boeing 737's so maintenance crews need to know only one plane.

77. (p. 229) The most fundamental criterion in vendor selection is ____________.
A. Serviceability
B. Price
C. Reliability
D. Location
E. Intangibility

Difficulty: easy
78. (p. 229) Intel demonstrated their commitment to China by ____________.

A. Making China a key supplier of chips
B. Opening a new plant in China
C. Giving China the product specifications for the most advanced chips
D. Giving China the best price on the latest chips
E. All of the above

Difficulty: easy
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79. (p. 229) A fundamental criterion in vendor selection is the vendor's ability to meet
contractual obligations including delivery times and service schedules. This concept is called
______
A. Supplier choice
B. Dependability
C. Reliability
D. Sustainability

80. (p. 230) Accountants, purchasing agents, engineers, and other players in a buying center
perceive the evaluation of products in different ways which makes a buying center:
A. Less effective than a center handled only by purchasing
B. More effective since individuals with different perspectives gives a well-rounded view of
the purchase decision.
C. Chaotic since there are so many different view points for a product evaluation
D. All of the above

81. (p. 230) Once a purchase decision is made, the sales process continues and is called
_____________.
A. Cognitive dissonance
B. Purchase evaluation process
C. Post mortem analysis
D. Post purchase evaluation

Difficulty: easy
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82. (p. 230) Any influence on the product and supplier choice is an organizational factor. The
primary organizational factor is _________.
A. Needs and desires of those involved
B. Opportunity for promotion of the buying center manager
C. Product specifications
D. Financial considerations
E. Risk tolerance

83. (p. 230) Once a sale is made and the product delivered in the B2B market the buyer _____.
A. Evaluates the product and supplier in a post purchase process
B. Considers the sale complete
C. Looks for rapid installation of the product
D. Uses pert charts to evaluate time efficiencies

84. (p. 231) All companies lose customers periodically. Losing a customer can be difficult or it
can ________________.
A. Be an epiphany
B. Be an episode of self-reflection
C. Be an opportunity to reacquire customers
D. Be an excuse to let people go
E. Be lead to lower prices because of pressure from the sales force

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85. (p. 231) EDI (electronic data interchange) allows _________.

A. Companies to talk to each other daily
B. Customer computers to communicate directly with supplier computers
C. Computers to fulfill the buying center function
D. Computers to do complex product evaluation with limited human involvement
E. All of the above
AASCB Standard: use of information technology

Difficulty: easy
Learning Objective: Comprehend the role of technology in business markets
86. (p. 231) B-to-B transactions have been growing at a phenomenal rate. On-line B-to-B sales
worldwide is now in excess of ______________.
A. $100 million dollars
B. $500 million dollars
C. $1 billion dollars
D. $1 trillion dollars

Difficulty: easy
87. (p. 231) One of the benefits of electronic data interchange (EDI) is ________
A. Customer computers communicate directly with supplier computers
B. Suppliers can listen in on buyers
C. Buyers get better prices than ever before
D. Late deliveries are less common
E. Technology linkages are more plentiful

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88. (p. 231) The process of business purchasing on-line is called _____________.
A. Fast procurement
B. Channel management
C. E-procurement
D. Team procurement
E. Effective procurement

Difficulty: easy
89. (p. 232) Many companies have set up direct links to approved supplier to make the purchase
easier and move it closer to the front line decision makers. These direct links are called
_________________.
A. Internet connections
B. Google B2B
C. Intranet
D. Extranet
E. T-lines of connection

90. (p. 232) Office Depot has a number of direct relationships using EDI with thousands of
companies. This relationship is done through a concept called ____________.
A. Extranet
B. Intranet
C. Electronic impact analysis
D. Utility functionality
E. Quick response program

Difficulty: easy
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Short Answer Questions
91. (p. 211) In B2B marketing, companies rely on a more personal relationship between the
buyer and seller, how does this differ from consumer marketing?
● Relationship development with consumers is impersonal and exists primarily through

electronic communication or direct mail. The opposite is true in business markets. The nature
of business markets requires a more personal relationship between buyer and seller.

Difficulty: easy
92. (p. 212) Within the organization, who is the person most responsible for maintaining B2B
relationships? Why?
● The individual most responsible for maintaining a relationship is the salesperson. This is
because customers want direct communication with company representatives and prefer
someone they know and trust.

Difficulty: easy
93. (p. 212) Why does technology play a critical role in connecting the buyer and the seller in the
B2B market?
● Customers demand not only a personal relationship with their vendors but also an efficient
one. Most companies now require vendor Internet connectivity to increase efficiency.
Integrating IT systems that enhance sales response times, provide better customer service, and
increase information flow is now an accepted element in a successful B2B customer
relationship.

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94. (p. 212) Business markets are characterized by fewer, but larger customers, how does this
affect customer retention?
● The large size and small number of customers places a higher value on each customer. In a
business market setting, losing even one large customer has striking implications for a
company.

Difficulty: easy
95. (p. 213) Why is geographic concentration an important part of some B2B relationships?
● Business markets tend to concentrate in certain locations. While the Internet allows people
to live anywhere, the nature of business relationships means a company wants to have a
strong presence near its best customers.

Difficulty: easy
96. (p. 213-214) Define supply chain?
● A supply chain is the synchronized movement of goods through the channel. In B2B
markets the supply chain is generally more direct with suppliers and manufacturers working
closely together to ensure efficient movement of products and services.

Difficulty: easy
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97. (p. 214) How has the demand for biofuels affected the demand for corn?
● Due to the rise in popularity for biofuels (ethanol), demand for corn has skyrocketed. Due
to the increased demand and price of corn other industries, such as the cattle industry which
uses corn in feed, have experienced set backs.

Difficulty: easy
98. (p. 214) Why is the demand for products and services different in a business market?
● Product demand in business markets is different from consumer demand on three critical
dimensions: derived demand, fluctuating demand, and inelastic demand.

99. (p. 215) Las-X makes medical lasers used in hair removal and cosmetic surgery. The
company recognizes that consumers have less disposable income now than they did just a few
years ago. Who are customers for Las-X and how does consumer demand impact Las-X?
What demand concept is illustrated here?
● Customers for Las-X are hair removal clinics, dermatologists, and cosmetic surgeons. When
consumers have less discretionary income, they are less likely to purchase cosmetic services.
Clinics are less likely to expand and derived demand decreases.

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100. (p. 216) Kiran runs Power3, a specialized battery manufacturer. His biggest account is an
international digital camera manufacturing company. Kiran would like to increase sales and
believes that if he lowers the price of his lithium batteries he will receive larger orders from
the digital camera manufacturer. What would you tell Kiran about the demand for his
product?
● The demand for Kiran's batteries is inelastic, meaning changes in demand are not
significantly affected by changes in price.

Bloom's Taxonomy: evaluation
101. (p. 217) Why is a new purchase the most difficult buying situation?
● A new purchase is the purchase of a product or service by a customer for the first time. The
more expensive, higher risk, and greater the resource commitment, the more likely the
company will engage in a full purchase decision process.

102. (p. 218) Why is the buying center an important part of the purchasing decision?
● The buying center is a group that manages the purchase decisions processes and ultimately
makes the final decision. Certain members of the group perform particular roles.

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103. (p. 219) Lucy is executive assistant to Doug Belden, the C.E.O, at Belden & Belden Office
Supply. Since Mr. Belden makes most final decisions in regards to purchasing decision, Lucy
is a key member of the buying center process. Recently Lucy has received information from a
new salesperson for one of their key suppliers, she is now deciding whom to send the
information to within the organization. What member of the buying center process is Lucy?
What member of the buying center process is the Mr. Belden?
● Lucy is the gatekeeper and Mr. Belden is the decider.

104. (p. 220-221) How does the North American Industrial Classification System (NAICS) help in
B2B marketing?
● The North American Industrial Classification System (NAICS) helps B2B marketing by
breaking down the industries and providing detailed information. The detailed information
includes: data on companies listed in each code, number of employees, sales revenue, their
location, and contact information.

105. (p. 222) Making Waves Boating has just returned from a trade show where managers
purchased ten new boats and multiple boating accessories. Making Waves already has
promised five of the boats to a local resort, and by Monday the remaining new items will be
on the showroom floor ready for purchase. In a B2B market what would Marking Waves be
labeled as a seller? Why?
● Making Waves is considered a reseller because they buy products and then resell them to
other businesses or consumers.

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106. (p. 223) How do government purchase practices differ from other B2B purchase practices?
● Local, state, and particularly federal government entities have unique and frequently
challenging purchase practices. Detailed product specifications must be followed precisely,
and the purchase process is often long.

107. (p. 224-225) Tyrone owns Orchid Odyssey a plant nursery that specializes in orchids. Tyrone
has had significant success with his Orchid of the Month mail order program, and as a result
needs larger nursery space. What part of the business market purchase decision process has
Tyrone just illustrated? What will he need to do next?
● Tyrone has illustrated the problem recognition aspect of the business market purchase
decision process. Next Tyrone will need to define his need for a larger nursery space,
including specifications.

108. (p. 227) When making a product selection as part of the business market purchase decision
process, what three primary criteria are used to make a decision?
● Financial criteria, value criteria and service criteria.

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109. (p. 229) Businesses understand that supplier qualifications are a main part of the purchase
decision. What are the main criteria the supplier choice decision and what to they represent?
● Reliability- the vendor's ability to meet contractual obligations. Personal factors- the needs,
desires, and objectives of those involved in the purchase decision. Organizational factors, or
risk tolerance.

Bloom's Taxonomy: synthesis
Difficulty: difficult
110. (p. 230) Why is it so important for the buyer and seller to participate in the post-purchase
evaluation of a product and supplier?
● The process helps customers to make better purchase decisions in the future. If you are the
current supplier than you have an obvious advantage as long as the customer evaluates the
purchase decision positively. However, if you are the current supplier and the customer
evaluates the purchase decision negatively, then you could lose a customer to a competitor.

111. (p. 231) Maureen runs a hospital in a metropolitan area, she believes that the hospital
should implement an electronic data interchange (EDI) system, but she is meeting some
resistance. What would you tell some of the people that are resisting the EDI system?
● By linking directly with electronic data interchange (EDI), customer computers

communicate directly with supplier computers to reorder as needed. Late deliveries, defective
products, and other issues related to supplier performance can be identified and dealt with
before they become a major problem.

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Essay Questions
112. (p. 211) In B2B markets, relationships and technology are increasingly important. Describe
the role of each.
A more personal relationship most often connotes a greater emphasis on personal selling and,
increasingly, technology. Customers want direct communication with company
representatives and prefer someone they know and trust. The individual most responsible for
maintaining a relationship is the salesperson. Personal selling also offers companies the most
effective method for direct communication with the customer. Technology has greatly
improved the quality and quantity of communications between buyer and seller. However,
one-on-one personal communication is still the most important tool in developing and
maintaining a strong customer relationship in business markets.
At the same time, technology plays a critical role in connecting buyer and seller.
Integrating IT systems that enhance sales response times, provide better customer service, and
increase information flow is now an accepted element in a successful B2B customer
relationship. Customers demand not only a personal relationship with their vendors but also
an efficient one. Most companies now require vendor Internet connectivity to increase
efficiency.

Difficulty: easy
113. (p. 212) Katherine is the marketing VP for a cleaning supply manufacturer. The firm's
products are proven to kill 99% of bacteria. The current target market of hospitals and skilled
nursing facilities. Katherine is considering branching into the consumer products market and
wants your advice on the five major differences in business and consumer markets. What do
you say to her?
See Exhibit 8.2

8-66
114. (p. 213) Victor has just transitioned from working in a primarily consumer driven market to
working in a B2B market. His company manufactures headlights for various vehicles. Victor's
business partner believes they need to move their production plant closer to their major
customers, Victor believes they can continue to operate as they always have. Who is right?
Why?
Victor's business partner is right. In the B2B market relationships are more important, it is
because of this that they should move to a more geographically logical area in which to
conduct their business. By being closer to their customer they are able to react more quickly
to their needs and to establish a stronger relationship over time.
Additionally, being closer to their customer will allow Victor and his partner to cut back on
transportation costs, which is also a good idea in the B2B market.

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115. (p. 215) Rosa, a marketing consultant, is preparing a report for a client that produces lumber
for use in the housing market. She is writing a section on market demand and needs to explain
the three types of demand. How should she explain this to her client?
Product demand in business markets is different from consumer demand on three critical
dimensions: derived demand, fluctuating demand, and inelastic demand.
All three offer unique challenges and opportunities for marketers. For example, two of the
three differences (derived and fluctuating demand) deal with the relationship between B2B
and B2C demand and suggest B2B marketing managers must first understand their customers
markets before they can sell to them.
Derived Demand
Demand for B2B products originates from the demand for consumer products, or, put another
way, demand for B2B products is derived demand. Environmental factors have long-term and
short-term effects on consumer product choices. This is a challenge for business marketers
because, despite having a great product and providing great service at a competitive price,
they may still not get the business because consumer demand for their business customers
product is weak.
Fluctuating Demand
The relationship between consumer demand and demand for business products presents a real
challenge for business-to-business marketers. Small changes in consumer demand can lead to
considerable shifts in business product demand and is referred to as the acceleration effect.
This makes forecasting the sale of consumer products important because making even a small
mistake in estimating consumer demand can lead to significant errors in product production.
Inelastic Demand
Business products experience fairly inelastic demand, meaning changes in demand are not
significantly affected by changes in price. Price increases, particularly incremental changes,
are often accepted because manufacturers are hesitant to disrupt manufacturing processes,
which, in turn, create inelastic demand in the short run.

8-68
116. (p. 216) Scampi Seafood processes fresh shrimp and fish caught off the coast of Louisiana.
The company wants to build another processing plant in Texas. Utilizing your knowledge of
the B2B purchasing process, explain how straight rebuy, modified rebuy and new purchase
will affect the purchasing of materials to build and open the new processing plant.
Since Scampi Seafood already has a processing plant, this will affect some of its purchasing
decisions. Major items involved in the actually processing function of the plant will be
purchased on modified rebuy. Since Scampi already uses products in its other facility, they do
not need to go through the added research and decision-making processes associated with new
purchases.
However, the actual physical facility and all purchasing decisions related to it, will be new
purchases. Scampi is operating in a new state and will therefore need to make new purchasing
decisions based on builders, and suppliers in the area that it wishes to establish their facility.
The normal day-to-day purchases that Scampi makes, such as office supplies and containers
for the shrimp and fish, will be straight rebuy since Scampi already uses these items in its
other facility.

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117. (p. 218) Antonio just graduated from the MBA program at this university and went to work
at his family's business, which is building custom wood furniture. He has finally convinced
his father that they need to upgrade the machinery they use to make the furniture and has
started to put together a buying center to make the purchase. His father doesn't think a buying
center is necessary and told Antonio to make the decision, what should Antonio say to his
father about the buying center? Whom should Antonio contact to be a member of the buying
center?
Antonio needs to explain to his father the importance of the buying center. There are many
people at the factory that will be impacted by this decision, and those people have pertinent
information in regards to new machinery purchase. He also needs to communicate that by
selecting a group of people to assist in the decision-making process, he will be making the
best decision for the organization in the long run.
In regards to whom should be invited to participate in the buying center, Antonio will first
want to include people that are using the current machines because they have first hand
knowledge of the limitations of the current system and the needs in a new system.
Additionally, Antonio will want to invite a member of the company supplying the machinery
so that technical questions can be answered during the meetings. Finally, it would be
beneficial for him to invite his father, his secretary (or another member of the organization to
be the gatekeeper) and any other people that will be directly impacted by the purchase
decision.

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118. (p. 220) Kenny is the leading salesperson for Polymer Sci., a supplier specializing in
polymers used in manufacturing processes. He wants to find new customers so he has started
to research how to approach a buying center. What are some challenges that he will face?
First, who is part of the buying center? Simply identifying the members of a buying center can
be difficult and is made more challenging by gatekeepers whose role, in part, is to act as a
buffer between buying center members and outside vendor representatives. The job of
identifying membership in the buying center is made even more complex as participants come
and go over time.
Second, who are the most significant influencers in the buying center? This is critical in both
preparing a sales presentation and following up. Targeting influencers is important in
persuading the buying center to purchase the salesperson's product.
Finally, what are the decision criteria for evaluating the various product options? A very real
concern for salespeople is making sure their products perform well on critical evaluation
criteria; however, without a good understanding of evaluation criteria it is not possible to
assess the probability of the product's success.
AASCB Standard: reflective thinking

119. (p. 223-224) Kari is the CEO of an up-and-coming new fashion label. She has just received a
big order and needs to obtain the necessary equipment and materials to be able to fulfill the
order. She has hired you, a business consultant, to assist her in making her decision. How
would you walk her through the business market consumer decision process?
Since we already know her problem (that she needs to obtain materials and equipment to meet
higher production), I would then help Kari specify the amount of materials and the kind of
machinery necessary to complete the order. If we decided it was necessary, I would help Kari
create an RFP (request for proposal) to send out to prospective suppliers.
Next I would help Kari search for appropriate suppliers. I would start with suppliers that she
currently uses, but also include others when necessary. Once I have circulated the RFP to the
selected suppliers, I would then ask for a sales proposal in return. With the sales proposal in
hand I would sit down with Kari and help her make the purchase decision. As part of the
product selection I would help her with create financial criteria, value criteria, and service
criteria.

8-71
120. (p. 229) You decided to open a sports bar with your best friend and are now trying to decide
between two suppliers. What do you consider when making your final decision?
The most fundamental criterion in vendor selection is reliability, which is the vendor's ability
to meet contractual obligations including delivery times and service schedules. Strategic
business-to-business relationships are based, in part, on a high level of trust between
organizations. In those situations, the supplier's reliability becomes an essential factor in the
final selection. Furthermore, a judgment is often made about the seller's willingness to go
above and beyond what is specified in the contract. All things being equal, the seller with the
best reliability and intangibles, like a willingness to do a little more than required, usually gets
the order.
Several additional factors affect product and supplier choices. Suppliers often find it difficult
to understand the role these factors play in the final decision, but their influence can be
profound. The first personal factors, refers to the needs, desires, and objectives of those
involved in the purchase decision. Everyone in the buying center comes with their own needs
and goals. Someone might see this as an opportunity for promotion, another believes he will
receive a raise if he can be successful, a third may want to impress management. It is not
possible to separate the individual agendas people bring to the buying center from the
purchase decision.
Another influence on the product and supplier choice is organizational factors. The primary
organizational factor is risk tolerance. Individuals and companies all have a certain tolerance
for risk. Their product decisions will be influenced by their aversion to or acceptance of risk.
AASCB Standard: reflective thinking

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121. (p. 229) Why is e-procurement play a larger role in B2B markets than in consumer markets?
What are some of the methods that have been put in place to make e-procurement ideal for the
B2B market?
B2B transactions have been growing at a phenomenal rate with online B2B commerce
worldwide in excess of $1 trillion, a much larger amount than that generated by B2C online
sales. The process of business purchasing online is referred to as e-procurement. The methods
are:
Industry purchasing sites: Industries have formed Web sites to streamline and standardize the
e-procurement process. Steel, chemicals, paper, and automobile manufacturers have created
integrated Web sites to assist their own purchasing departments in online purchasing and
supplier selection.
Business function sites: Certain business functions have Web sites to standardize purchasing.
Extranet to major suppliers: Many companies have set up direct links to approved suppliers to
make the purchase easier and move it closer to frontline decision makers.
Company buying sites: Many large companies have created their own Websites to assist
vendors. RFPs and other relevant supplier information as well as some contact information
are accessible for review.

8-73
Another random document with
no related content on Scribd:
am living in a modest room on the upper floor) at half-past five,
thinking it best to see them as far as the harbour myself. The
appointed time has come, but not a carrier is to be seen. I wait till a
quarter to six, and am becoming somewhat uneasy, when I am aware
of the gradual approach of so frightful a din that there cannot be the
slightest doubt as to who is causing it. But have the twenty-four been
suddenly multiplied by three? A closely-packed crowd roars and
surges in the square beneath me; the bass voices of the men, the
shrill, vibrating cries of the women make up a pandemonium of
sound; but no disorderly actions take place—in fact I had not
expected any. The crowd follows me in a confused mass for the few
hundred paces down to the harbour, where the ferry-boat is waiting.
“Bwana, I would rather stay here,” says Kazi Ulaya, the handsome,
with a tender look at the fair one beside him. “Do what thy heart
prompts, my son,” I reply mildly. “And this is my boy, sir,” says Pesa
mbili II, of Manyema, who has by this time recovered his plumpness.
But he refrains from introducing to me the bibi, who, in some
embarrassment, is hiding behind his broad back.
“Now sing those fine songs of yours once more.”
The men are standing round me in a serried circle. “Kuya
mapunda” goes very well; the pleasing melody rises in full volume of
sound above the voice of the rushing Lukuledi. In “Dasige
Murumba” too, the singers acquit themselves fairly well; but when
the standard song, “Yooh nderule” begins, the circle seems full of
gaps, and my eye can distinguish in the twilight various couples
scattered here and there among the bushes by the bank. “Ah!
farewell scenes,” I think to myself, but soon perceive that I am
mistaken; no tender sentiments are being discussed, but my matter-
of-fact fellows are throwing themselves like wolves on the last repast
prepared for them by loving hands before the voyage. I wish them,
sotto voce, a good appetite, and make a note of the fact that the heart
of the native, like that of the European, can be reached through his
stomach.
The ferryman shouts impatiently to hurry them up, and I drive the
unattached contingent of the singers down into the shallow water.
Splashing and laughing they wade towards the boat; the darkness
has come on rapidly, and I can only just distinguish the white figures
as they clamber on board. “Yooh nderule, yooh nderule, bwana
mkubwa nderule”—the familiar sounds, long drawn out, ring over
the water in Pesa mbili’s voice—“kuba sumba na wogi nderulewa,
yooh nderule”—the chorus dies away. The boat has disappeared in
the darkness, and I turn my steps towards the mess-room, and the
principal meal of the day, where I am once more claimed by
civilization. The Weule Expedition is at an end.
ENTERING THE RED SEA
CHAPTER XIX
FROM LINDI TO TANGA
On Board the ss. König, in the Mediterranean, off the

Mouths of the Nile, January 20, 1907.
A few hours ago, in losing sight of the palms of Port Said, we left the
last of Africa behind us. The flat, sandy shore of the Egyptian Delta
has now vanished from our view, and a grey waste of waters lies
before the vessel as she fights her way with increasing difficulty
against the rising north-west gale. The Mediterranean in winter is
not inviting. No trace in reality of the ever-cloudless sky we have
been taught to look for; and Captain Scharf, who certainly ought to
know, says that he has never experienced any other weather here at
this time of year. This season is always cold and stormy, forming no
pleasant transition between the delightful temperature of the Red
Sea in winter and the sub-Arctic climate of the Atlantic and the
North Sea. We shall have to steam along the coast of Crete and to
pass close enough to the southern extremity of Greece, to catch sight
of the snow-covered peaks of the Spartan mountains; so much does
the head-wind retard the course of our broad-bowed, somewhat old-
fashioned boat, which, for a first-class steamer, makes wonderfully
little way. The traveller has all the more leisure to retire, in the
comfortable smoking-saloon, into the solitude of his own thoughts,
and take stock of all that he has seen, heard and learnt in the last
nine months.
The evening of the 2nd of December passed very pleasantly on
board the Kanzler in Lindi roadstead. One could scarcely make out
where so many white-clad Europeans came from, all at once. One of
the passengers attributed this influx to the iced Pilsener which
Ewerbeck and I lavished in unlimited quantities in the high spirits of
departure; but this suggestion is scarcely to be taken seriously. The
presence of a German steamer in the harbour is in these latitudes
always a festival, celebrated by most people whenever it comes
round. And quite rightly so, for nothing is more deadening than the
monotony of workaday life in Africa.
The trip which had taken the Rufiji three days of hard work was
performed by the swift Kanzler in one day. Early on the morning of
the fourth, Ewerbeck and I landed at Dar es Salam: Ewerbeck, in
order to take his final leave of the Protectorate, and I, to give account
to the Government of the financial and administrative side of my
expedition. For a new-comer like myself a change of place made no
difference; but the Imperial District Commissioner was visibly
moved by sad and serious thoughts. He had spent the best part of his
life, over fifteen years, in the development of this very part of
German East Africa; and, in such a case, a man does not leave the
scene of his labours with a light heart.
Dar es Salam was still more delightful than in June. At this time of
year it abounds in mangoes of every size and every variety. The
mango-tree was long ago imported from India, and is now found
wherever Indians are settled in East Africa, whether in British,
German, or Portuguese territory. It is certainly a pleasanter
immigrant than the low-caste Indian; it somewhat resembles our
linden tree in its mode of growth, and gives a pleasant look of home
to a settlement. The fruit, sometimes as large as a child’s head, is
served on ice at every meal, and is almost equal in flavour to the
pine-apple.
Into this pleasant, easy life the news of the events of December
13th came like a bolt from the blue. An excellent hotel, the
“Kaiserhof,” had been opened just before my return to Dar es Salam,
and I had the great pleasure of being one of its first guests. We were
almost suffocated with comfort: electric light, a broad, shady
verandah outside every room, a comfortable bath-room attached to
each apartment, and a more than luxurious table were, together,
almost too much of a good thing, after our lean months in the bush.
Fortunately, however, man becomes accustomed to every thing, even
to good living.
I have seldom seen so many long faces as in those days, when the
news of the sudden dissolution of the Reichstag burst like a bomb in
the comfortable, well-to-do official circles of the town. It seemed as
though every single European, down to the lowest subordinate, had
been personally affected by the event; all the mess-rooms were loud
with the dismal prognostications of the croakers as to the black
future—or rather the want of any future—before the colony, whose
inglorious end seemed placed beyond doubt,
as each of us foresaw that the General Election
in January would admit at least a hundred
Socialists to the Reichstag. “And of course it is
all up with the railways,” was the stereotyped
refrain of all these lamentations, which the
mourners duly drowned in a sea of whisky and
soda. Personally I am convinced that things
will not be as bad as that, but that the next
Reichstag will show at least as much feeling
for the colonies as its predecessor, or, indeed,
it is to be hoped, still more. On January 25th
our steamer is to arrive at Genoa; on that date
the elections will be over, and on the following
day we shall be able to get a general survey of
THE AUTHOR IN the results, and form some idea as to the fate
BUSH COSTUME of our colonies in the immediate future.
I left Dar es Salam on December 20th by the
Admiral, a splendid boat, almost new, and rolling far less even than
the Prinzregent. It was also more comfortable than the latter; it was
no wonder, therefore, that all the cabins were full. We had still more
English on board than in the spring; many from Cape Town, and still
more from Johannesburg. Accordingly, the prevailing style of dress
was noticeably luxurious. This time I was able to go ashore at Tanga,
and even see something of the Usambara railway. Captain Doherr,
with his usual foresight, had (probably remembering the managerial
functions which he had been called upon to perform a few months
previously, in the service of the eight Deputies) arranged for a special
train to be ready for the passengers, or at least for such as wished to
avail themselves of it. With this we made the run to Muhesa, where
the expedition was brought to a halt by means of enormous dishes of
sandwiches and trays of whiskies and sodas. Something is really
being done in the north-east of the colony, as one can see even from
the train; it is true that not all the land is yet under cultivation, but
every bit of it is already in the hands of a permanent owner, even far
beyond the rail-head.
There were grand doings at Tanga in the evening. This town enjoys
a whole series of advantages. In the first place, it is the nearest to the
mother country of all our East African ports, and thus constitutes the
gateway to the colony. In the second place, the harbour is tolerably
good; the bay, indeed, is not land-locked to the same extent as that of
Dar es Salam, but, like the latter, it has sufficient anchorage within a
short distance of the shore. The most important point, however, is its
nearness to Usambara, the choicest part of our territory as regards
climate and soil. Usambara has but one fault: it is not large enough
to accommodate all would-be settlers. It is said that even now the
available land has been allotted, and there is no chance for later
applicants. Many of these are now staying at Tanga, or on their way
south to seek new fields for their energies: in fact, the boom at Lindi
was in great part caused by the congestion in the north. The
economic centre of gravity, therefore, for our whole colonial activity
lies at present in this north-eastern district. This, by the bye, is
evident from the whole aspect of European life at Tanga. After
passing many months on end in the Usambara mountains, with no
opportunities for social intercourse, the planter suddenly feels the
need of society, and in a few hours’ time we may behold him seated
in the club at Tanga.
Where there are Germans, there is also music. Dar es Salam enjoys
the advantage of two bands—that of the sailors from the two cruisers,
and that of the askari. Both are under official patronage, but I
cannot say much for the proficiency of the native performers: in any
case, their music was accompanied by a great deal of noise. At Tanga
it is not in economic matters only that the residents assert their
independence—even the Boys’ Band of that town is a purely private
enterprise. Tanga is a scholastic centre par excellence, hundreds of
native children being instructed in the elements of European
knowledge and initiated into the mysteries of the German tongue,
which, indeed, one finds that all the little black imps can speak after
a fashion. The more intelligent, in whom their teachers discover, or
think they discover, any musical gift, are admitted to the famous
Boys’ Band. This is just now in excellent training. When the
passengers from the Admiral presented themselves in the evening on
the square in front of the Club, the band turned out to welcome
them, and the playing was really remarkably good.
CHAPTER XX
RETROSPECT
At the Entrance to the Red Sea.
Christmas and New Year’s Eve were passed at sea, with the usual
festivities; the latter, on which the dancing was kept up with equal
enthusiasm and energy by German and English passengers, was also
the eve of our arrival at Suez.
About noon on the first day of January, 1907, I set foot on the soil
of Egypt, which I have only just left, after a stay of nearly three
weeks. I had a great desire to study the relics of ancient Egyptian
culture on the spot, and therefore left Cairo and its neighbourhood as
speedily as possible for Upper Egypt—Luxor, Karnak and Deir el
Bahri. From a climatic point of view, also, Cairo was not well adapted
for an intermediate station between the tropics and the winter of
Northern Europe. One after another of our passengers remaining
behind for a tour in Egypt became indisposed. Some, therefore, took
the next boat for Germany, arguing that their colds “would cost less
at home,” while others made off up the Nile by train de luxe, in order
to accustom themselves slowly and carefully in the glorious desert air
of Assuan to the sub-arctic climate of Ulaya.
The Assuan dam is historically a piece of Vandalism, technically a
meritorious piece of engineering, economically a truly great
achievement. The narrow-gauge railway winds up the Nile in sharp
curves between Luxor and Assuan. Sometimes the Nile flows in
immediate proximity to the track—sometimes there is a narrow strip
of alluvial level between the sacred stream and the new unholy iron
road. All this time one is oppressed by the narrowness of the country;
it seems as if the first high wind must blow the sand right across it
and bury it altogether. Suddenly the bare hills on the left retreat: a
wide plain opens out before us, only bounded in the far distance by
the sharp contours of the hills in the Arabian Desert. The plain itself,
too, is a desert—but how long will it remain so? Turn to the right and
consider the great block of buildings which meets your eye. It is
neither Egyptian nor Arabian, there is none of the dirt of Fellah
barbarism about it; on the contrary, it represents the purest Anglo-
American factory style. The tall chimney crowning the whole, and
emitting a dense cloud of smoke, forms an incongruous contrast with
its surroundings—the silver Nile with its border of green fields,
running like a ribbon across the boundless sands of the desert to east
and west. Look before you at the straight canal crossing the plain and
lost to sight in the distance and the ditches and channels by which it
distributes the Nile water in all directions, with perfect regularity.
The building is a pumping-station, established to restore the desert
plain by irrigation to its former fertility. Now it is still perfectly bare:
in a few months’ time, it will be a sea of waving corn with stalks
bearing fruit a hundredfold.
The economic exploitation of the Upper Nile Valley is an example
which ought to be followed by our own colonial administration.
Without a resolute purpose, without capital, and without accurate
knowledge of the country and its resources, even that English or
American company could do nothing. We need all three factors, if we
want to make any progress, whether in Eastern or in South-Western
Africa, in Kamerun or in Togo. There is only one small point of
difference—the alluvial soil of the Nile Valley, accumulated through
many myriads of years needs nothing but irrigation to once more
make it into arable soil of the first quality. The Nile, wisely regulated,
is the magic wand which will, almost instantaneously, change the
desert into a fruitful field. This transforming agency is absent in the
bush and steppes of German East Africa. It is true that that country
possesses numerous streams, but at present their volume of water is
subject to no regulation, and none of them is navigable on the same
imposing scale as the Nile. In the course of years, no doubt, the
Pangani will become an artery of traffic, as also the Rufiji, and
perhaps our frontier stream, the Rovuma; but it will not be within
the lifetime of the present generation.
The soil of German East Africa, too, cannot be compared with that
of Egypt; it is no alluvial deposit, rich in humus, but in general a
tolerably poor one, produced by the weathering of the outcropping
rocks and not to be rendered fertile by moisture alone. Nevertheless,
so far as I am able to judge, the water question remains the cardinal
one in our colonial agriculture. At Saadani they have begun at once
to do things on the grand scale, breaking up large areas with steam-
ploughs, in the hope that wholesale cotton cultivation may put an
end to the American monopoly. So far this is very good; the
temperature is favourable, and the soil quite suitable for such a crop.
One factor only is uncertain: German East Africa, like India, is never
able to reckon on a normal amount of atmospheric moisture—and, if
the rains fail, what then?
The Dark Continent has often been compared to an inverted plate.
The land slopes gently upwards from the sea-shore, the angle of
inclination gradually becoming greater, till we have a bordering
range of mountains of considerable height. But it is only as seen from
the coast that this range can be said to have a mountainous
character; once he has crossed it, the traveller finds that, as on the
heights of the Harz or the Rhenish slate mountains, he is on a plain
almost level with its summit. To carry out the comparison with the
plate, we may say that he has now crossed the narrow ledge at the
bottom, and is now walking over the horizontal surface within that
ledge.
This peculiar conformation has to be taken into account by those
engaged in developing our colonies, i.e., in the first place, it is
responsible for the fact that the rivers are navigable only to a very
slight degree, if at all. In the second place, the greater part of the
rainfall is precipitated on the seaward slope of the range, while its
other side is almost rainless, which accounts for the arid character of
Ugogo and the neighbouring districts. Yet the greater part even of
this interior has a soil on which any crops which can be cultivated at
all in Equatorial Africa are well able to thrive. The planter there is
fortunate in being able to count on the vivifying influence of the
tropical sun, which, throughout the year, conjures flourishing fields
out of the merest sand. In the south I was able, day after day, to
convince myself of the truth of this assertion.
The South has hitherto been the Cinderella of our colonial
districts, and I fear it is likely to remain so. The prejudice as to its
barrenness has deterred both official and private enterprise. It is true
that neither the Mwera Plateau nor the Makonde highlands, nor the
wide plains extending behind these two upland areas, between the
Rovuma in the south and the Mbemkuru or the Rufiji in the north,
can be called fertile. Sand and loam, loam and sand, in the one case,
and quartz detritus in the other, are the dominant note of the whole.
Yet we have absolutely no reason to despair of this country, for if the
native can make a living out of the soil, without manuring and with
none of the appliances of our highly-developed intensive farming—if
this same native is in a position to export an appreciable fraction of
his produce in the shape of sesamum, ground-nuts, rubber, wax,
cereals and pulse—it would surely be strange if the white man could
not make much more out of the same ground.
One thing, indeed, must never be forgotten: neither this district
nor Africa in general is a pays de Cocagne where roast pigeons will
fly of their own accord into people’s mouths; work, unceasing,
strenuous work, is just as much an indispensable condition of
progress as in less happy climates. We have had sufficient
opportunity to observe and appreciate this persevering industry in
the case of the Makonde, the Yaos, and the Makua. And we may be
sure of one thing, that the European planter, whether in the north or
the south, on the coast or in the interior, will not have a much easier
time than these people. That, however, will do him no harm; on the
contrary, the harder the struggle for existence, the more vigorous has
been the development of a colony throughout the whole course of
human history. The United States of to-day are the standing proof of
this assertion; the South African colonies, now developing in a most
satisfactory manner, speak no less clearly, and other cases in point
might easily be adduced.
The waves are running higher, the König having more breadth of
beam than depth, does not roll, but cannot help shipping more seas
than she would like. Ought I, in face of this grand spectacle, to let
myself be absorbed in useless forecasts of the future? My friend
Hiram Rhodes’s taunt about “political childhood” was cruel—yet
there was some truth in it, and not as regards the Zanzibar treaty
only. We Germans have begun colonizing three hundred years later
than other nations, and yet Dick, Tom and Harry are raising an
outcry because our colonies, acquired fully twenty years ago, do not
yet produce a surplus. The honest fellows think that “South-West”
alone ought to be in a position to relieve them from the necessity of
paying any taxes whatever. One could tear one’s hair at such folly
and such utter lack of the historic sense. Most books are printed in
Germany—none are bought, and but few read there. Among these
few we can scarcely include any works on colonial history, otherwise
it would be impossible that even colonial experts should know so
little of those thousand conflicts, difficulties and reverses
experienced to their cost by the English in India, in the South Seas,
in Africa, and in America, and which over and over again might well
have disgusted the Dutch, the Spaniards, and the Portuguese with
their extensive colonial possessions. Unconsciously influenced by the
wealth of England and the affluence of Holland, both in great part
arising from their foreign possessions, we are apt to forget that three
centuries are a period fifteen times as long as our own colonial era,
and that at least ten generations of English and Dutch have won by
hard, unceasing work what we expect to receive without effort on our
part. I am firmly convinced that we shall never learn to appreciate
our really splendid possessions till a more thorough system of
instruction has supplied the want above referred to—doubly
inexcusable in a nation whose intellectual pre-eminence is
everywhere acknowledged.
Such historic sense is to be gained by putting two kinds of capital
into the colonies—the blood shed for their preservation and
development, and the hard cash spent on the utilization of their
resources.
To illustrate the extent of the British Colonial Empire and its
distribution throughout the world, it is often pointed out that the
mother country is seldom without a colonial war of some kind. This
is true in the present, and it has also been true in the past: England
has in fact always had to fight for her dominions beyond sea.
Undoubtedly, this three hundred years’ struggle for possession,
which, under her special circumstances has often been for England a
struggle for existence, is the principal ground for the peculiarly close
and intimate relation between the mother country and the daughter
states. Hardly a family but has dear ones buried in Indian or African
soil. This fact at first attaches to the country a painful interest, which
very soon gives rise to an interest of another sort. The truth of this
doctrine has been illustrated in the saddest way for us by the
sanguinary war in South Western Africa.
The other kind of capital—the monetary—cannot be discussed in
the case of our colonies without touching on the railway question.
What complaints have been made of the invincible reluctance of
German capitalists to engage in colonial undertakings! I am not
myself a wealthy man, but, if I had a million to lose, I should
nevertheless hesitate before investing it in a country without means
of communication, being entirely devoid of natural ones, while
artificial ones are as yet only in the elementary stage. At home, every
one is now expecting great things from the new driver of our colonial
chariot. Herr Dernburg is a trained financier, and he, perhaps, can
succeed where others have failed—in the completion of the great
railway system projected long ago, and in procuring the no less
necessary financial resources.
Lastly, the native is not without an important bearing on the future
of our East African colony. As an ethnographer, I am in a better
position to form an opinion about him than with respect to other
questions, in which the outsider like myself has only common sense
to guide him. The black man is pronounced by some, “an untrained
child;” by others, “utterly depraved and incurably lazy.” There is yet a
third party who are inclined to leave him at least one or two small
virtues, but these are steadily shouted down. It is true that the native
population of the Coast towns have a horror of any serious work, and
look down on it as a lowering of themselves; but I think we may be
permitted to entertain a better opinion as to the great mass of the
people in German East Africa. The most numerous tribe in the whole
colony are the Wanyamwezi, who are estimated at about four million
souls, and occupy the whole central area east of the Great Rift Valley.
No one has yet ventured to doubt their industry or their capacity for
progress; they are excellent agriculturists, and at the same time they
were, for a whole century, the mainstay of the caravan trade between
the coast and the heart of the continent. Before long this traffic must
in the nature of things cease, but we have no right to suppose that the
Wanyamwezi will therefore become superfluous. A glance over the
reports of the Uganda Railway will show us how fortunate we are in
possessing such an element in the social structure as this vigorous
tribe. Let us then be wise enough to encourage and develop this
economic force for the native’s own benefit, and above all to get the
full advantage of it ourselves. What is true of the Wanyamwezi is also
true of many other tribes. Even now, I cannot forget the impression
made on me by the high average of the farming which I saw among
my friends in the Rovuma Valley. People who, however often they
have been displaced, still cling so firmly to the soil, must certainly
have great potentialities for good, or all the teachings of racial
psychology and history are falsified. This unexpectedly high stage of
culture can only be explained by an evolution extending over a
period of incalculable length. There is nothing to disprove the great
antiquity of agriculture among the Bantu; they are conservative, as
their continent is conservative; the few alien elements still in the
economic stage of the collector and hunter—the Bushmen in the
most arid parts of the south, and the Pygmies in the most
inaccessible forests of Central and West Africa—must have been
crowded out by them many centuries ago.
The farming of our natives is done entirely with the hoe—that
implement-of-all-work, with the heavy transverse blade which serves
alike for breaking up and cleaning the ground, for sowing the crops,
and, to a certain extent, for reaping them. We are too much inclined
to think of this mode of cultivation as something primitive and
inferior, and, in fact, in so far as it dispenses with domestic animals,
whether for work or for the supply of manure, it is really very far
behindhand. But we must also take into account that some parts of
our colonies are infested with the tsetse-fly, and that the system of
cultivating narrow strips of ground entirely with the hoe really marks
a very high stage of farming. The best proof of this is the retention of
the narrow bed in our gardens, where the cultivation can scarcely be
said to be of a more elementary description than that of our fields. It
is significant, too, that for the more intensive forms of culture when
carried on in the open fields, e.g., flower-growing, as near Erfurt,
Quedlinburg, Haarlem, etc., and market-gardening as in the
neighbourhood of Brunswick, Hanover, Mainz, and other large
towns, the long, narrow bed is most in favour. Moreover, it is
difficult to see how the native could cope with the weeds—the
principal danger to his crops—were it not that his narrow beds are
easily reached from all sides.
The native mode of agriculture, therefore, need not be interfered
with: it has been tested and found excellent.
Another question is, how shall we, on this basis, make our black
fellow-subjects useful to ourselves? In my opinion, there are two
ways, as to both of which the pros and cons are about equal. Both
have been in operation for some time, so that we have a standard to
guide us in forecasting the ultimate development of the whole
colony. In the one, the native is not encouraged to advance in his
own home and on his own holding, but is trained as a labourer on the
plantation of a European master—plantations being laid out
wherever suitable soil and tolerable climate promise a good return
for outlay. The other method has the progress of the native himself in
view, and aims at increasing his economic productivity by
multiplying and improving the crops grown by him on his own
account, teaching him new wants and at the same time increasing his
purchasing power. In this way it is hoped that he will exchange his
exports for ours.
The future must show whether the German people will decide for
one of these ways to the exclusion of the other, or whether, as
heretofore, both will be retained. For the mother country their value
is about equal and depends on the degree of activity shown in
colonial affairs as a whole. But the second is decidedly to the
advantage of the native himself. As a plantation labourer he is and
remains a mshenzi; as a peasant proprietor he is able to advance. At
the same time we must not forget that our colonies were founded in
the expectation of providing homes for our surplus population, and
that if the native is to claim the most fertile parts of his own country
for himself, nothing can come of that ver sacrum. It also depends on
the general direction of our policy whether the numerical increase
and physical improvement of the native are to our interest or not.
Some primitive peoples have almost or entirely disappeared under
the influence of civilization; the Tasmanians belong to history; the
Maoris of New Zealand and the Kanakas of Hawaii are rapidly
diminishing, and we have lately heard of the last Vedda in Ceylon.
The negro race does not belong to these candidates for extinction; on
the contrary, wherever it has come in contact with the white, it has
grown stronger in every respect; there is therefore no fear of its dying
out. But shall we go further and, by artificial selection, deliberately
raise their coefficient of multiplication? Certainly we ought to do so,
for a numerous resident population is under all circumstances a
benefit to us. It solves the labour problem for the planter, and, on the
other hand, the European manufacturer and merchant will, of
course, prefer a large number of customers to a small one. How is
this improvement to be initiated? I have nothing further to add to the
remarks which, à propos of the various diseases and other scourges
of this continent, occur in the preceding pages.
In Europe some people are stupid, others of moderate capacity,
and yet others decidedly clever. The huge lip-ornaments of the
Makonde and Makua women sometimes produce the impression of a
simian type of face, and small boys occasionally suggest by their
features a not remote kinship with the missing link, but this exhausts
the list of excuses I could have alleged for looking down from a
superior height on the people in question. In all the months spent
among the natives of the Rovuma Valley, I never discovered any
reason why we should, as we are so fond of doing, associate the idea
of absurdity with the African. On the contrary, the behaviour, not
only of the elders, but of the liveliest of the young people in their
intercourse with Knudsen and myself, was characterized by a quiet
dignity which might well have served as an example to many a
European of similar social position. My personal experiences will not
allow me to believe in the dogma of the negro’s incapacity for
development. It cannot be denied that he has achieved a certain
intellectual progress, even in North America, though the obstacles
there are greater than the facilities. Why, therefore, should he not
rise, as soon as the opportunity is offered to him in such a way that
he can take advantage of it? Only we must not expect this advance to
take place overnight, any more than we can expect a rapidity of
economic progress at variance with every law of historical
probability.
It is now quite dark; the boat must have changed her course, for
the gale no longer meets us in front, but comes from the port side, so
that no doubt we are approaching Crete. To-morrow, or the day after,
we shall pass the coast of Greece. I must confess that I am looking
forward to a sight of this country, though I do not regard its classic
age with the same unbounded and uncritical enthusiasm as many of
our countrymen, to whom the ancient Greek is the embodiment of all
historical and cultural virtues. One thing only even the blackest envy
cannot deny to the Hellenes of old—a courage in colonial enterprise
which we should do well to imitate both now and in the future.
This future is still shrouded in mystery. Will our East African
colony become a second India? I do not doubt for a moment that it
will, and my mind’s eye sees the whole country traversed by railway
lines. One of these follows the old caravan road from the coast to
Tanganyika. The iron horse has superseded the old carrier-transport,
and the clattering train now bears the carriers themselves, as well as
bulky goods which could never have been put on the market under
the old system. One line runs to the Victoria Nyanza and another to
distant Nyasa; we are able to link up with the British network of
railways in South Africa, with the communications of the Congo
State, with the Nile Valley. Thirty years ago Stanley’s march to the
Lake Region and his boat-voyage down the Congo were epoch-
making achievements. We of to-day may perhaps live to make the
trip by train de luxe from the Cape to Cairo, and from Dar es Salam
to Kamerun.
INDEX
Abdallah bin Malim, Wali of Mahuta, 352 et seq.;

his noisy devotions, 399–400
Achmed bar Shemba, song by, 31
Adams, Pater, on the Makonde, 259–60
African continent, conformation of in relation to Colonization, 415
race, original home, question of, 12
African Fund, the, 9, 10
Age-classes, 304
Akundonde, Yao chief, information from, 140, 184
settlement of, 212,
visit to, 213 et seq.
Alum, as water-clarifier, 153–4
Ancestor-worship, 326
Antelope-hunting, 200–1
Anthropology, difficulties of, in G.E. Africa, 53
Artistic aptitudes of Natives (see also Drawings), 36
Asiatic origin of African races, discussed, 12, 13
Assuan dam, the, lessons from for Germany, 413–5
Astronomical beliefs and customs, Yao, 184–5
Atlantic Ocean, historical density, 6
Axes, etc., bewitched, 210–12
Babies, see Children & Infants
Bagamoyo roadstead, 2
Bakeri of Zanzibar, 140, 142–3
Bangala river, Camp at mouth of, 208
Bantu imitation of the Masai, 118
origin, tribes of, 12, 53, 139
Baraza, the, 65,
described, 135
Bards, 170, 175
Bark-cloth, ceremonial uses of, 276–7, 313
manufacture of, 274 et seq.
Barnabas as artist, 367–8
Birth customs
Makonde, 281, 283
Yao (as to twins), 283
Black race, distribution of, explanation of, 13
Boots, question of, 71
Bornhardt on the geology of German East Africa, 66, 67–8
Botanical features (see also Bush), Masasi region, 69
Bows and arrows, 74
methods of using, 75–6
as toys, 285
Boys’ initiation ceremonies, see Lupanda, and Unyago
Brass-founding, native, 267–70
British Colonial Empire, comments on, 417
Burial customs,
Makua, 132
Yao, 194 & note
Bush and Scrub vegetation, 51, 52, 60
Bush-burning, 58–61, 255, 257
Bwalo, the, 231 & note
Calico, as dower, 306

over graves, 194, 214
Camp life, 83–4
sleeping discomforts, 119, 163, 164
Cape Banura, 24, 25
Guardafui, 14, 15
“Cape rubies,” 209, 210
Carnon, Archdeacon of Masasi, 45
hospitality of, 74
Carriers, see also Wanyamwezi,
difficulties with, 393
paying off of, and farewell to, 393–4, 400, 405–7
Cattle, Matola’s, 138,
stampede by, 164
Central Lukuledi Valley, lions in, 245
Chain-gangs, 28, 44,
native drawing of, 371
Charms (Dawa), 129;
used in Majimaji rebellion, 51
“Cherchez la femme!” 397–9
Child-life, native, G.E. Africa, 157–8 & note, 284 et seq.
Children, native, characteristics of, and aspect, 148
Chingulungulu, author’s stay at, 104 et seq.
description of, 134 et seq.
diseases noted at, 192
meaning of name, 104 note
native amusements at, 169
characteristics, 106
route to, from Mkululu, 126–7
water-supply at, 150–2

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True / False Questions

Multiple Choice Questions

25. Business-to-business markets are:

26. The nature of business-to-business markets requires:

31. A supply chain is ________________________.

34. Business-to-business demand is said to be relatively inelastic. This means that

38. A straight rebuy is:

43. In the buying process the "user" is characterized as __________________.

44. An Initiator is ____________.

54. NAICS codes now include __________.

55. With respect to Buying Centers ____________.

56. NAICS codes are a classification of businesses that ___________.

59. Resellers are important to marketers because ______________.

66. Request for proposal (RFP) is the process of ___________.

67. A request for proposals (RFP) ____________________.

69. When responding to a RFP the B2B marketer may __________.

70. When a marketing company responds to an RFP, _____________.

72. Industrial sellers often include with the RFP a ________.

77. The most fundamental criterion in vendor selection is ____________.

78. Intel demonstrated their commitment to China by ____________.

85. EDI (electronic data interchange) allows _________.

87. One of the benefits of electronic data interchange (EDI) is ________

88. The process of business purchasing on-line is called _____________.

Short Answer Questions

95. Why is geographic concentration an important part of some B2B relationships?

96. Define supply chain?

101. Why is a new purchase the most difficult buying situation?

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