Definition

Product specification

Product specification is the stage of the business buying process in which the buying organization decides on and specifies the best technical product characteristics for a needed item.

The buying organization develops the item’s technical product specifications often with the help of a value analysis engineering team. Product value analysis is an approach to cost reduction in which components are studied carefully to determine if they can be redesigned, standardized, or made by less costly methods of production. The team decides on the best product characteristics and specifies them accordingly. Sellers, too, can use value analysis as a tool to help secure a new account. By showing buyers a better way to make an object outside sellers can turn straight rebuy situations into new task situations that give them a chance to obtain new business.

Share it:  Cite

More from this Section

  • Target costing
    Target costing— pricing that starts with an ideal selling price based on customer considerations ...
  • The buying process
    The buying process starts when the buyer recognizes a problem or need triggered by internal ...
  • Net marketing contribution (NMC)
    Net marketing contribution (NMC) is a measure of marketing profitability that includes ...
  • Global market
    Global market refers the worldwide economic market place in which business operates today, ...
  • Cause-related marketing
    Cause-related marketing is a kind of marketing that links a firm’s contributions to ...