Demand, when it comes to economics, is the willingness of a consumer to buy what is being sold or the service being rendered.
When launching a business or if already in business, determining and remaining updated on the demand for specific products and services is necessary for the longevity of any business. It prepares a fair and competitive foundation from which to build and prosper.
Thus, demand needs to be measured on a regular basis because demand of a product can effect one of the most important items to any entrepreneur – pricing. If the demand for a product goes up, then it’s fairly safe to raise the prices. However, if prices are raised too much, it could decrease the demand of the product. Therefore, entrepreneurs must always have their hands on the pulse of the consumer in order to determine what is both needed and wanted.
Some examples in Black Entrepreneur History of Black business owners who knew the importance of demand are Alonzo Franklin Herdon who knew that prominent white men of his time wanted not only look great but they wanted to look great in a fashionable venue to feel elite. At the same time, he employed highly skilled African American barbers, providing opportunity to earn great income for the people of his own community. He met the demand for both and also helped the Black community in the process.
Another person who knew the importance of demand was Annie M. T. Malone who launched hair care products and beauty supplies for Black women when there were none. There was a huge demand and she filled it.
That being stated, once entrepreneurs understand demand, they will understand how to continue the growth of their company by keeping their eyes and ears on the consumer.