Our market existence should be well-defined in one way or another.
Especially as we grow in our operations there are various forces which tend to reposition the way we do business.
That is when we leave from the usual so as to create a new progressive dominance.
Of course there are various types of markets for any specific type of entrepreneurial business.
In this edition we try to find a common ground that talks almost all types of businesses with an aim to come up with nodes for measuring real market growth and stability.
I have discovered that most of our SMEs are always caught in-between as they try to balance between underproduction/deficit and overproduction/surplus.
Both scenarios have some negative consequences on the performance of our enterprises.
No wonder why we always go back to the drawing board for real advice by our economists.
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So in this saga our goal is to strike a market balance through operating at an equilibrium.
Those in the school of economics will further announce that demand for our markets/customers should always be equal to the supply of our offerings.
That is when we will be able to come up with a viable market price.
It is worrisome that most of our businesses are always offside due to some economic planning which does not match the VUCA environment which we are operating in.
Something should be done. It is not just a matter of equating demand and supply but also to ensure that we reach a state of efficiency in the way business resources are managed/allocated.
As a reminder from our previous editions these resources comprise land/manufacturing space, capital (financial and non-financial) and labour.
Above all when these are managed effectively and efficiently we then call ourselves entrepreneurs of this age.
In this edition we then try to unpack some critical factors to be considered for what I call a balanced market for entrepreneurship.
Let’s simplify economics for our home-grown enterprising.
To start with price is a critical central pivot as determined by the market equilibrium for our SMEs operation.
This is because in simple terms an increase or decrease in the price can directly influence the quantities of our products/services that are demanded by our customers.
This being the matter it is then important to come up with the right price for our offerings rather than just a simple thumb suck.
Many of us just do price as determined by a small part of the market yet it should be a broad decision.
Business modelling by us or any consulted professional can help in coming up with a precise price for our offerings.
Also to note is that there are other various reasons why people buy our products/services which connects to the price.
Quality is one critical factor. There is need to do a thorough check through a well-calculated market research for an SME to be sure on how customers perceive the quality of your offerings.
Most of the time we do a wrong judgment through becoming product/service marketing myopia and over-price a product/service which the market is viewing as of poor quality.
Inferior goods have their place too on the market, but what really matters is to charge a price that is not expensive.
The same goes with high quality products/services where a relatively higher price will be viewed as proper and talking to right customers.
Most businesses/institutions do not know their market value in terms of quality such that they sometimes sell at a lower price than what the market expects for a high quality.
So let’s do it wisely and yield more where we can.
As we proceed it is important to greatly consider income levels/wages of our broader markets.
I have seen that most of our entrepreneurs sell what they think they are able to produce rather than what the market can afford.
The income level of your targeted customers is vital as a determinant of demand.
As we start in our enterprising we should investigate on the income levels of our customers.
Usually in low income markets our offerings should match such type of a clientele base where the product/service should be designed using a low-cost approach for a low pricing.
There is no harm in having two designs for the same product, that is, having one which is a bit expensive for an affluent market and another relatively cheaper for low-income earners.
Also our markets have shown a trend of accepting new innovations in a continuous way.
Our entrepreneurs should follow the same bandwagon through coming with products/services that meet the ever-changing tastes and preferences of their current and prospective customers.
This is also a critical determinant of demand in this age of enterprising.
Our customers are unstoppable in such a way that if you fail to adhere to these changes then customers will jump to other competitors in the same market.
That is the same reason why some previously dominating players in the telecommunication industry have become extinct as they failed to cope with the pace through engaging in a wider technological adoption mode that talks to the current generations and practices.
Lastly for this edition it is important to know that cultural dynamics are critical in managing demand for our entrepreneurial markets, especially when your business is on an expansion drive into other provinces, regions and global.
There is need to know where your business fit in addressing certain cultural needs of a specific market.
The beliefs, norms and values of the customers have a strong and direct influence on the demand of our broad markets.
In this edition we tried to look at the demand side of our entrepreneurial markets in our drive to be at a market equilibrium.
Our next edition will look at the other side of supply for a complete circuit.
*Dr Farai Chigora is a businessman and academic. He is the head of business science at the Africa University’s College of business, peace, leadership and governance. His doctoral research focused on business administration (destination marketing and branding major, Ukzn, SA). He is into agribusiness and consults for many companies in Zimbabwe and Africa. He writes in his personal capacity and can be contacted for feedback and business at fariechigora@gmail.com, www.fachip.co.zw, WhatsApp mobile: +263772886871.
