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Bundling and splitting decisions in purchasing
Description of research
When a buyer has to purchase a set of products and/or services he searches for the optimal way to buy on the market. One of the decisions the buyer has to make is whether he bundles the products and/or services or buys them in separate lots. For example, buying various products and services needed for a construction project separately is an alternative to buying a complete project. This is an important decision as it can have a large effect on cost components such as the purchasing price and operation costs.
The bundling decision involves a large number of attributes (i.e., dimensions), such as the purchasing volume and the risk of bankruptcy or non-delivery. These multi-dimensional decision problems are often underestimated and are typically based on intuition: often buyers immediately move on to selecting the right supplier for the products or services. A good understanding on what attributes play a role in bundling decisions can help buyers to make better founded decisions about the degree of bundling. Unfortunately, current research offers little guidance on important attributes for bundling decisions. The overall goal of this project is to investigate, analyse, model and improve the decision-making on bundling. To achieve this goal we will research the following subjects during the project:
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What are the attributes of bundles that are relevant in the bundle decision? |
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What are the effects of buying bundles with certain attributes? |
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Are these effects recognized by buyers in practice? |
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What types of bundle decisions can we distinguish? |
Advisor(s)
Duration
February 1st 2005 – March 1st 2010
Project
None
Funding institution
NEVI Research Foundation
Strategic Research Orientation
Purchasing and Supply Management
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