Competition in Business Market - Term Paper Example

In the economic cycle consumer is inevitable to business’s working and survival. As any produced good or service relies on the consumer’s demand, who consumes it eventually. Thus, consumer demands, choices, preferences, and decision-making are significant aspects of the microeconomic system as they shed light on how any consumer chooses to exert his influence on any economic activity. Similarly, the consumer is faced with the option of choosing from among the diverse products to meet his needs the most efficiently and likewise, prudently utilizing his asset/cash.

Now how a consumer chooses and spends his earnings to invest in the capital of the company is a comprehensive and diligent process, which mainly focuses on how two parties (business owner and consumer) involved take business and spending decisions. The main factors which impact the purchase inclination and decision of a consumer are the price of the goods or services, quality, reliability, durability, and feasibility. However, there are many other factors as well, which influence the preferences of the consumer as well like fashion, marketing, government policies, and social or religious preferences. Yet, the core idea to learn about marketing strategy relies on the understanding of consumer decision-making (when and how he decides to pay for goods or services).

The term which describes how a consumer makes his decision to earn maximum advantage from the purchase of any god or service is known as utility. This utility enables the consumer to spend more than usual on the goods/services, which benefit him in more than usual manner. However, not all consumers can similarly benefit from any product/service. Thus, diverse levels of utility are associated with different types of consumers and this diverse nature of utility creates distinctiveness in the demand for goods/services too. However, this consumer inclination or decision-making is received in the form of raw data by the business owners, who further base their production decisions on two main factors: logic and competition in the market. Read More