There are various market forces that affect organizational responses in various ways. Mainly, supply, demand, and marketing to consumers etc. is the factors of market force. The amount of goods which are available for sale in the market is called supply.
Market cannot provide more products than its supply to the customers. On the other hand, demand refers to the amount of goods or services desired by the customers in the market. At first, it is very common for a new product. By this way, supply and demand have a negative relationship. Almost all organizations expect to reach a point where supply and demand are equal.
That point is called equilibrium. Equilibrium is regarded as the ideal point in the market. In addition, both supply and demand are also measured by price. Marketing strategy can change the equilibrium point of the company in its supply and demand. It is marketing activities that can increase the demand for the products and thus a shift in equilibrium.
At this point demand and supply meet customers’ need. ? Demand and supply forces in UK: Demand and Supply are the two market forces which are required to set the prices of commodities. Demand and supply is an economic model with helps in determining prices of commodity in the economy. Demand means a desire, willingness and ability to buy a good or service. Demand refers total demand of consumers in the market.
Supply means quantity of goods or service which producers are willing to sell at a possible market price. Supply can refer total output of all the producers in the market. A sudden change in demand and supply forces gives shape to the organizational responses. ? Demand and change in Demand forces: utility for a product affects the demand of commodity.
Utility mean usefulness and satisfaction that is received by the consumption of good or service.
Changes in demand occur due to the following reasons:
- Change in price of commodity.
- Change in the number of consumers who demand the commodity.
- Change in the income level of consumers.
- Change in the taste and preference of consumers.
- Change in the expectations of the consumers.
- Changes in the prices of substitute goods.
For example, change in the prices of tea shift the demand curve of all the producers of Tea industry. In increase in the prices of tea demand for the tea will decrease and if there in decrease in price of tea demand of tea increases.
There is a negative relationship between demand of a commodity and its prices.
