Demand factors

31.03.2017

Guide for external and internal demand factors in the Global Management Challenge simulator and their influence on demand.

Internal factors of demand are factors of demand, which elasticity does not depend (or almost independent) on market share occupied by all companies in the group:

  1. Backlog of orders - demand is equal for markets and products, linear function y = k * x
  2. Seasonality - demand depends on market, is equal for products, constant
  3. Corporate advertising - demand is equal for markets and products, linear function y = k * x
  4. Direct advertising - demand is equal for markets and products, linear function y = k * x
  5. Agents and distributors - number - demand is equal for markets (acts only in EU and Nafta) and products, power function y = k ^ x
  6. Agents and distributors - support - demand depends on market (acts only in Internet), is equal for products, power function y = k ^ x
  7. Agents and distributors - commission - demand depends on market, is equal for products, linear function y = k * x
  8. Management budget - demand is equal for markets and products, power function y = k ^ x
  9. Training - demand is equal for markets and products, power function y = k ^ x
  10. Ports - demand depends on market (acts only in Internet), is equal for products, linear function y = k * x
  11. Website development - demand depends on market (acts only in Internet), is equal for products, power function y = k ^ x

 

External factors of demand are factors of demand, which elasticity depends on market share occupied by all companies in the group:

  1. Assembly time - demand depends on market and product, power function y = k ^ x
  2. R&D - demand depends on market and product, linear function y = k * x
  3. Prices - demand depends on market and product, hyperbolic function y = k / x
  4. High quality raw materials - demand depends on market and product, linear function y = k * x

 

Elasticity of external demand factors depends on market share in previous period in addition to its own function. The higher overall market share occupied by companies, the less elasticity of factors.