{"id":4368,"date":"2024-10-28T07:28:01","date_gmt":"2024-10-28T07:28:01","guid":{"rendered":"https:\/\/www.gniotgroup.edu.in\/blog\/?p=4368"},"modified":"2024-10-28T07:28:04","modified_gmt":"2024-10-28T07:28:04","slug":"demand-analysis-importance-and-types","status":"publish","type":"post","link":"https:\/\/www.gniotgroup.edu.in\/blog\/index.php\/2024\/10\/28\/demand-analysis-importance-and-types\/","title":{"rendered":"Demand Analysis for Managers"},"content":{"rendered":"\n

MEANING OF DEMAND ANALYSIS<\/strong> <\/h2>\n\n\n\n

Demand analysis<\/a> implies an analysis of the state of demand for a commodity or service. It determines the factors affecting the demand for a commodity or service and also measures their effects on demand. This analysis is also the basis for forecasting the future demand for a commodity or service. Demand forecasts help in maintaining balance between demand and supply of a product.<\/p>\n\n\n\n

Purposes and Importance of Demand Analysis<\/strong><\/p>\n\n\n\n

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  1. Demand Forecasting:<\/strong> demand forecasting means an estimation of the demand or sales of a commodity or service over a future period. The forecasts and future plans of other activities prove futile in the absence of precision in demand forecasting.<\/li>\n\n\n\n
  2. Manipulating demand:<\/strong> after analyzing various external conditions he chooses an appropriate sales policy and sales strategy for increasing the sales of his firm\u2019s products.<\/li>\n\n\n\n
  3. Proper allocation of resources:<\/strong> demand analysis plays an important role in assisting a business manager in taking decision of shifting the scarce resources of the firm from unprofitable or less profitable uses to more profitable uses.<\/li>\n\n\n\n
  4. Demand analysis is the benchmark for the evaluation of the performance of the sellers and sales representatives and determination of their sale quota.<\/li>\n\n\n\n
  5. It can be used for studying the competitiveness of the company.<\/li>\n\n\n\n
  6. Demand analysis is also necessary for production, scheduling, planning of the inventory control and evaluation of the working capital requirements.
    <\/li>\n<\/ol>\n\n\n\n

    MEANING OF DEMAND<\/strong>
    Demand in economics implies such various quantities of a given commodity which the consumers are willing to purchase in a given period of time at the various prices in the market. It shows the relationship between the quantities bought and the price of a commodity prevailing in the market at a particular moment of time.
    Prof. Benham, \u201cThe demand for anything, at a given price, is the amount of it which will be bought per unit of time at that price.\u201d<\/p>\n\n\n\n

    1. An effective desire<\/strong>: A desire is merely a wishful thinking about a good or service. The desire for a thing can be termed as effective only if the following three things are present: a. Desire for a thing
    b. Sufficient means to satisfy that desire c. Willingness to use the means<\/p>\n\n\n\n

    2. A define price:<\/strong> demand is always with reference to a particular price.<\/p>\n\n\n\n

    3. A point of time:<\/strong> demand is always in reference to a specific time period, such as weekly demand, daily demand, annual demand, etc.<\/p>\n\n\n

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    \"show<\/figure>\n<\/div>\n\n\n


    KINDS OF DEMAND<\/strong><\/h3>\n\n\n\n
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    1. Price Demand:<\/strong> it shows those quantity of goods which, other things remaining the same, a consumer is ready to buy at a particular moment time of the different hypothetical prices.<\/p>\n\n\n\n

    -Price and demand are inversely related<\/p>\n\n\n\n

    (Other things remaining same: the price of commodity, prices of related goods, consumer preferences, tastes, fashion, etc., do not change.)<\/p>\n\n\n\n

    <\/p>\n\n\n\n

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    <\/div>\n<\/div>\n<\/div>\n\n\n\n
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    \"show<\/figure>\n<\/div>\n<\/div>\n\n\n\n

    2. Income Demand<\/strong>: those quantities of goods or services, which a consumer is willing to buy at different levels of his income, if other things remaining the same.<\/p>\n\n\n\n

    \u2013 It can be studies under two heads<\/p>\n\n\n\n