METHODS OF BUYING

 

Methods of buying

 

method of buying 

Introduction:

 

There are generally accepted methods of buying and selling. The economy most economy especially in Africa is developing and as a result, the method of buying may differ from those of other countries. For example bidding for goods is acceptable in Nigeria, whereas, in other countries like Britain or the united state of America, buyers pay whatever price is set by the seller. In view of the nature of our mixed culture in Africa. Here we are going to be looking at various method of buying most focused on the growing economies like the African countries.

 

Techniques of buying

 

Buying means the acquisition of goods which are capable of satisfying needs by payments, especially money. The producer of yam may need seed yams for planting on his farm. If the farmer dose not has seed yams in his barn, he would have to buy some from a seller of seed yams. In order to exchange his money for seed yams, there should be a means of determining the price should be acceptable to both the buyer and the seller. The process for such agreement is called the method of buying because the buyer initiates the move to buy goods which have been made available by the seller. The seller can only sell, when the price is favorable to him. At the time, the buyer will buy only if the price is also acceptable to him. There are basically four method of buying. These are by;

1.      Description

2.      Sample

3.      Auction

4.      Inspection of goods

 

Four method of buying

Buying by description:

 

When buying by description, the buyer relies on the description of goods by the manufacturer. There are several products or goods sold in stores, the open air market and installs market. A consumer who needs butter or margarine would normally rely on the description of the product. For one thing the buyer cannot open the product, taste it before buying. Also cocoa drinks, ice-cream, coffee, soft drinks cannot be tasted before the consumer pays for it.

There is usually unexpressed trust between the buyer and seller that the product will meet the description, in terms of flavor, and workmanship, in some cases, buying a product by description may beyond unexpressed trust, especially when the seller guarantees the product. Usually such guarantee is expressed as,” this product is guaranteed from all defects due to poor workmanship” or “satisfaction guaranteed or money refunded” in this case, buying by description becomes an agreement for example, in 1986, the manufacturers of a certain baby food and other baby products were asked in Britain to remove their products from the market because they had been contaminated in the process of manufacture. As a result, the buyers were not getting the satisfaction they desired. The company quickly recalled all the products from Britain and all over the world.

Some goods are sold according to grades and these grades are ranged in order of size quality. For example, eggs are sold according to grades A, B, or C. Usually grade A eggs are the biggest size, grade B is medium, while grade C is the smallest. Prices are fixed according to grade. The buyer can see the variation in sizes, but it is difficult to determine the content, in term of the albumen and the yolk.

 

Buying by sample:

Sample method buying is when the individual consumer is allowed by the seller to taste or test the product before paying for it. Several manufacturers allow buyers to use their product for a certain number of days, if satisfied with the performance, money can be sent to the seller. This is practice in most countries where the market system has developed.

In developing countries, there are a number of goods which are sold by sample. For example a customer may want to taste a cherry or mango before he or she buys. If the buyer is satisfy with the taste, he may decide to buy from the seller. A seller may also allow the buyer to try on a shirt before paying for it.

Many manufacturers of new products such as soap and detergent manufacturers give potential customer some quantity to examine the usage. If the potential customers are satisfied with quality of the new product, they are likely to leave other competitors products. Sometimes, such commodities are not given out freely. The potential customer is asked to pay a token for the product. In some cases the products are made into trial packages and no money is charge. The sample method of buying has been used by various manufacturers.

 

Buying by auction:

 

Auction means the selling of goods in public. Prospective buyers bid against one another for goods. For an auction to take place, a large number of people would have had sufficient knowledge of the goods to be sold. It can be said that sale by auction is a democratic way of selling goods to a majority of the people. Usually, the goods to be sold are bided on (priced) by those who need the goods. The highest bidder usually buys the goods. In auction sales, the public or interested consumers would be informed of the date, place and type of goods to be sold. Goods sold at auctions are in most cases not graded.

Auction sales are carried out on both new and old products. A manufacturer can auction off excess raw material or finished goods if he wants to bring out a new brand of goods or if he is going out of business.

Auction sales must fulfill the following conditions:

1.      An auctioneer must be appointed

2.      Enough notice must be given to prospective buyers

3.      Place of auction must be specified

4.      Goods are sold on the highest bidder

 

Buying by inspection:

 

In buying by inspection, the buyer has an opportunity to look closely at the goods he wants to buy. This way, he is able to compare the physical appearance of an item with other products of the same class. The buyer will be buying wisely, since he can ascertain between the beauty or shape of the product as well as the quality of craftsmanship.

Buying by inspection is one of the most commonly used methods in developing countries. In some countries, practically everything needed by the consumer is packaged so that the consumer has to rely on the description on the label. In most countries, practically we need to satisfy our needs are sold by inspection. Shoes, clothes, food, construction materials and books are all sold by inspection. The buyer is usually responsible for his choice. Many shop or stall owners except big chain stores like Kingsway, or leventis will not take back defective goods. Since the buyer has the opportunity to look closely at the product he is buying, he cannot return the goods to the shop if they prove to be defective. A careful look at the receipt of commodity sold by some shops carry the warning that money shall not be refunded for goods returned. However some shops do allow customers to carry commodities equivalent to the amount paid in exchange for faulty goods.