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FMCG Supply & Demand – Microeconomics

#Alfred #Marshall (British Economist) first introduced the #Supply & #Demand theory in 1890.

#Apple Inc. products are not subject to price sensitivity as such, as Customers buying Apple’s products tend to be indifferent: when it comes to pricing, leading to inelastic demand.

The likes of Supplier-rating & Price-comparison Websites, such as, #Trustpilot, #MoneySupermarket, & #Uswitch have led to more transparency & ease-ability, as far as selecting a #FMCG supplier is concerned.

Behavioural Economics – FMCG Industry

Noble Prize Winners, Richard Thaler & Daniel Kahneman have done some excellent work on ‘Behavioural-Economics’. B.E – Behavioural-economics is a complete ecosystem; which exists in every organisation. Internally the B.E revolves around the emotions of employees v management decision making. Externally, the B.E revolves around the emotions of customers v the repeat sales & profit margins.

The relationship between price & demand can be non-linear on the basis of B.E. As the economic decision of consumers are based on ‘emotions’ rather than ‘rationality’.

The likes of Power BI have made it possible to quantify the impact of B.E & make reliable future forecasts (regression).


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