Organizational buying occurs through description, inspection, sampling, or negotiation. Purchasing power is created by income. However, not all income is available for spending. For this reason, marketers consider income in three different ways. Personal income is the income an individual receives from all sources less the Social Security taxes the individual must pay.
Disposable income is personal income less all additional personal taxes.
These taxes include income, estate, gift, and property taxes levied by local, state, and federal governments. Discretionary income is disposable income less savings and expenditures on food, clothing, and housing. Discretionary income is of particular interest to marketers because consumers have the most choice in spending it. Consumers buy with the hope of getting a large amount of current and future satisfaction relative to their buying power. Consumers buy because they would rather have a particular good or service than the money they have to spend to buy it.