Why customers may have a low purchasing power?

[Activator230822]

There are many reasons as to why customers may have a low purchasing power. Some of these circumstances that can contribute to this can be among;

Poor economic instabilities
This can be evident especially when a nation is about to and after conducting a general election.
During this times most people don't engage in the production and business operations as whole over the fear of the fate of election results and the transition of powers from the incumbent president to the president elect. This can subsequently lead to the low purchasing power of the retailers and hence the customers at large.

When the prices of commodities/ items are relatively high
Customers tend to purchase on very small quantities of goods when the prices are higher and awaiting for the prices to go down for them to buy in larger quantities.

When the customers are working on a very tight budget
This can also lead customers to buy only the prioritized goods and in very small quantities because of the limited budget they work on.

When the customers are broke and don't like to enter into debts
When the people are broke due to lack of jobs and employment opportunities they tend to reduce their purchasing power. This is because they simply lacking funds and not willing to borrow money for making purchases

 

[Augusta]

The most outstanding thing here is lack of money. This is like the most obvious point. purchasing power will be low when the customers have no money. Another as you have stated is when the prices of commoditiesare relatively high. of course customers will purchase on very small quantities of goods when the prices are higher. So this simply means low rate of having money pow sales for businesses.

Again, it will be down if the customers are working on a very tight budget. So the customer will only go for what they have budgetrd to buy do that the little money they have will cover for budgeted expenses.

 

[SHAHID987]

Inflation increases many fold and it reaches all time high so how can we expect that people will purchase things normally. Not only poor people but somewhat previously established people are not in the position to purchase things normally. Purchasing power is directly related with the cost of products if it increases normally then people won't have any prominent effect on their purchasing power.

 

[Johnson2468]

A customer's poor purchasing power could be caused by a number of factors. The state of the economy is one of the primary causes. People often have less discretionary money and are less likely to make significant purchases when the economy is struggling or uncertain. A fall in purchasing power can also result from both underemployment and high unemployment rates.
Personal financial problems such as excessive levels of debt, unforeseen bills, or a lack of savings are another cause of poor purchasing power. Even during times of economic boom, these considerations may make it difficult for people to make significant expenditures.