Increase in demand is good news for any company as it leads to more sales which in turn results in more profits, increase in demand happens when the consumers demand more products at the same price. It can happen due to many reasons, given below are some of the reasons behind increase in demand for a good or service –
- When there is growth in the country which leads to rise in general income of the people.
- When there is a technological change which results in more demand for that product. One example is mobile sales; 20 years back there was no market for mobiles now it is such a big market.
- When consumers expect that in future there will be rise in price then they began to stock a product which leads to increase in demand for such product.
- When there is environmental change then also demand for some product may jump, for example in past few years’ sales of filter water bottles have increased because of lack of clean water due to pollution.
- When the price of other substitutes rises then also demand for a product would be high as consumers would shift from higher priced product to lower priced product.