Market Dynamics: Varied Demand Patterns
In the always-advancing world of product development, the interdependence between product cycles, sustainability, and innovation is undeniable, but not always straightforward.
Successfully driving product innovation to meet or surpass customer demand requires an up-to-date, nuanced understanding of market dynamics - the most complex of which is the difficulty to predict demand outside of standard stock and flow.
Plus, markets are changing more rapidly now than ever before. Trends that may have played out over a decade in the past might run the same course over just a year.
Take COVID-19, for example, and the last few years since the pandemic. After mass shutdowns, there was a huge spike in demand for to-go containers. The movement to support restaurants and small businesses with the limitation of not being able to go into them increased carry-out business like never before.
While it has come down since, many restaurants are still experiencing more takeout business compared to their pre-pandemic averages. So even though overall demand for to-go containers has settled down, more volatile peaks and troughs are expected to continue, only across even shorter time periods.
When you account for supply chain, source material, manufacturing equipment, production capability, sales cycles, design, etc., it's easy to see how exponentially unmanageable production and fulfillment can become when demand forecasting is too far off.
Even the dot-com boom, while further back historically, continues to evolve and shift the retail environment – which is one of the top drivers of packaging use. Online orders can be shipped in the product’s original packaging, packed into a larger box or container for shipping, combined with other products and padded with additional packaging materials, and the list of permutations goes on and on.
Demand planners trying to project material, capacity, or anything else are met with uncertainty more regularly now than in decades past. But being adaptable to rapidly changing market dynamics is crucial for the whole business.
Demand fluctuations are showing no signs of slowing down any time soon. And while you might not be able to forecast demand, you can make sure your pricing strategy is flexible and ready for the dynamics of the market.
The right pricing solution will make sure you protect, and even grow, margins, regardless of the market uncertainties. If you're ready to learn how to protect your margins and profitability amid market volatility, talk to an expert about Pricing-as-a-Service.