Relationship between business, demand and supply.

[Ephy]

Business is any idea either in form of a product or service that can be sold with an aim of making a profit. Demand is the need or unavailability of a product needed mostly for human consumption. Here also you need to understand them term supply. Supply is the movement of products from the market to the final user who is the consumer.

Therefore this three things can't do without each other. For a business to exist there must be demand for a particular product or service and for the demand to be satisfied there must be supply of the products to the market for the consumers to buy or consume. Any business without demand from customers that business never succeed because you cannot sell goods that are not in demand it that particular area.

You cannot also supply goods to the market and no one needs them you have first make sure there is market for your goods in order to start your business and become successful.

 

[Alexandoy]

You are right. In an economy there exist the demand and the supply for a particular industry and the business is the go-between. One best example is the farm products. The farmer planted the vegetables but he cannot sell it because he is not a businessman but just a farmer. The demand is there but they cannot go to the farm to buy. The business comes in to buy the farm products and place it in the market for selling. The customers will be happy to see the products in the market. That is how commerce works.

 

[Donkiz]

One of the major things that determines the success or otherwise of a business is location. Before starting any business it's very important to do market survey to determine whether there's a need for such business in that area. For instance, anyone that opens a shop where he/she sales generators in an environment where there's uninterrupted power supply will have little or no patronage.

Before setting up a business in an area, you need to determine the demand level of your intended product or service in the area, and its only when the demand is high that the supply will also increase, thereby making your business successful.

 

[marcusfe]

These terms are interconnected and can't be separated from one another. Business is the act of rendering services or offering products for sale in order to generate income. There is nothing called business without product or service and there will not be sales without demand and supply. Demand in business is when the customers are request purchase the product or service while supply it the act of delivering the service or product to those who demanded for them. There is no way we can separate any of the terms. Demand and supply are what guarantees the sustainability and continuity of business.
Without them there is no business. Whenever there is product advertisement, the customers make demands and the business makes the supply.

 

[Kingsley]

Any attempt to influence the forces of demand and supply, but either the government creating a monopolistic market will lead to disequilibrium. The forces of demand and supply determines what happens to the prices of goods and services mostly in a perfect competitive market where there is free entry and free exit. So the primary purpose of setting up a business entity is purposely for profit maximization. No wise person person person will want to invest his time and money and energy and not attract demand. Even during the planning stage of the business, The entrepreneur must have consider to questions like what to produce, for whom to produce , how to produce , and the distribution channels, because the distribution channel is what determines how the goods or services will be able to reach the final consumer. And remember production is said to be complete only when the goods and services reaches the final consumers.

So as an intelligent business person one must provide a very satisfactory answers to all the above questions and afterwards, steps should be taken on how to increase the demand, because when the demand increase beyond we can get up price and profit and at some point supply aswel.

 

[Shaf]

Demand and supply are the basis of business, but they are sadly one of the most underestimated things when people are planning for a business.

One of such mistakes I've noticed in this area is underestimating the degree of competition. If there's a lot of competition, it would mean that there would be less demand and less customers for a new business in that niche as supply would be saturated

Another one is not considering the long term demand of what you have to offer. For products that people need only once in a while, it will be hard to make consistent sales to generate profits and keep the business running for long.