Table of Contents:

1  Introduction  3

2  Tasks of supply market research  5

  a Investigation objects  6

  i Product  7

  ii Market structure  8

1  Part of supply  8

2  Part of demand  9

  i Market motion and market developmental change  10

  iv Supplier  11

  v Price  13

3  Instruments of analysis of supply market research  14

  a Supply market analysis  14

  b Market observation  14

  c ABC-analysis  14

  d Analysis of material  15

  e Supplier analysis  16

4  Conclusion  19

5  List of sources:  20

6  Footnotes:  21

7  Vocabulary list 23  

  2  

1 Introduction

Information is prerequisite for the solution of decision problems. On the one hand there must be clarity about objectives, on the other hand about facts of the own com- pany and about facts of the markets. The first-mentioned information are authoritative the last-mentioned are effective. Lots, for the purposes of planning needed, authorita- tive information have to be found on the basis of appropriate hypothesis out of prog-

nosis. 1

Central foundations of decisions are useful information about the feasible possibilities to act. There are internal and external sources for them. Internal you get particularly cognitions about present and potential market partners.

Interesting are the offering programmes of the suppliers, their prices and other condi- tions. Also their credibleness according to amounts, deadlines and quality. Beyond it are details about the demanding competitors important as well as the com- plete position and development on the supply market and their pre-markets.

All information like this you get out of a systematic supply market research. 2

In theory and practice was not paid attention to the supply markets and their explora- tion for a long time.

By mistake was intended that the procurement of materials, individual parts and de- vices is a smooth business and that the providers with their marketing actions are doing enough to get the necessary market transparency.

Today are getting the supply markets in the economic literature and in the economic procurement function more advertency. Because of the regional enlargement of the supply markets, the dynamic changing of market conditions and market structure and the changing conceptual formulation of the buyer agents, is an ideal purchase not possible without an intensive and systematic exploration of the supply markets.

3

Only with the help of the supply market research it is possible to detect market chances and market problems and to admit a realization and solution for it. Supply market research is all operational measures for the collection and condition- ing of information, which are important to get transparency about the supply markets and to higher this transparency. 3

4

2 Tasks of supply market research

To the market aimed actions of the procuring companies are addicted by a lot of fac-

tors, which must be acquired, analysed and from the procurement decisions consid-

ered.

This is the task of the supply market research; it should make information about po- tential suppliers available and make information available about market factors and

environmental influences that affect on them. 4 The classic device of market research classifies the ambit of market research in the

ambit of “market analysis” and “market observation”.

This is to point two things out. First it is to make clear, that the states of the markets

have to be analysed and that market deployment and market movement have to be

watched. Second it is possible with this classification to detect the two cardinal

schemes of market research. The first is the time oriented scheme and the other is

the period oriented scheme. Supply market research is the exploration of basic struc- ture, of a buying market on a given business event.

You create a kind of cross-section of the supply market and illustrate it as a kind of a

snap shot. Therefore do you determine the number of provider, their production ca-

pacities and their market share, the situation of competition and the possible transits.

One of the most important components of the supply market research is the supplier

analysis.

The supply market observation is a trace of deployment of certain market sizes dur-

ing this time. Changes of the market structure or of the current market situation will

be visible. The assembly of new production capacities will be demonstrated and the adjournment of demand will be traced.

5

Nevertheless the market observation and the market analysis are not two separated

parts. It is a complement of both, they are flowing into themselves and the market

observation fructifies the market analysis and inverse.

The market observation is as a rule based on the results of market analysis. On the

other way round it is possible that foremost because of market observation it is get- ting clear to carry out an accurate market analysis.

If the data material received from market analysis and market observation will be

used to derivate the common deployment of markets it is called market prognosis.

This is one of the most difficult departments of supply market research. It is the base

for the future decisions of procurement. 5 In the end you have to decide on which areas the observation should take place and

how many times the markets should be observed as well do you have to decide how

deep the analysis should be carried out and about the dimensions of outcomes. 6

a Investigation objects

There are a lot of methods and technologies to gain and to deal with data material.

These methods are similar with the methods of the delivery area; they only have to

be accommodated to the supply market.

You have to differ between the field research and the secondary data collection.

Field research means that you carry out your own inquiries on the market. These

could be verbal and written interviews or questionings. You carry out this field re-

search because of your own motives.

The secondary data collection on the contrary uses already available data for their

own problems. These data already exists before the company starts the market re- search. Sources might be public offices, statistic offices, ministries or specialized

journals. 7

6

If you want to get knowledge about coherences and inter-relations of markets you have to get a lot of data and information. Happening on an existing market is the re- sult of cooperation of lots of factors. The following factors are in focus:

First it is important to know as the basics and starting point, everything about the product, whose market should be researched. After it you have to analyse the struc- tural characteristics of the supply and the demand side of the researched market. You also have to try to characterize and make the deployment tendencies and dy- namics of this market transparent. Another major investigation object is the supplier. You have to get different information about his capability on the several areas. Last but not least are the observation and the analysis of prices. The price is in many

cases a very important part of purchasing. So it went into the limelight of procure- ment departments.

The acceptation of each investigation object is different. Mostly is only one investiga- tion object more important than the others. All these objects are adjunctive with each

others. 8

i Product

You have to know everything about the product you want to buy. You have to know all technical details about it, before you start your supply market research. The re- searcher has to find out what is the primary material respectively everything about the material quality of the product you want to buy. He also has to find out of what particles and assemblies the product is made up and everything about its technical, chemical and physical features and characteristics.

One of the problems of supply market research is that the researches have not enough knowledge about the technical details of the product. So it is difficult to get information or to analyse market research results.

7