Integrating demand and supply has been rated the most effective way of improving performance in any profit-making firm. However, to attain the integrating point is a journey that only firms with appropriate strategies will attain. Looking at the most performing firms, it is clear that they have mastered the art of integrating demand and supply and hence they have managed to attain a competitive advantage in the market. Synchronizing the forces of demand and supply requires appropriate mechanisms whereby marketing plays an important role in ensuring that a product has undergone the four stages and that a company is making volume of sales by meeting demand. In the event of integration, firms face challenges that inhibit achievement of strategies to attain competitive advantage. These barriers in one way or another subject the firm to a situation that makes it difficult to attain the supply and demand integration (Fleisher, & Bensoussan, 2015).
The three levels of a product are the core, actual and the augmented ones. Firms, therefore, focus on maximizing the three levels of the product so as to maximize profits. However, this is achieved when supply meets demand and hence it is a complex journey for most companies globally. When a firm has a strategy to expand its market, it often picks the choice of product augmentation whereby the product will have the primary features of the main product and the benefits that accompany the augmented product are mostly appreciated by customers. An example of Tecno Mobile Company and how their smartphones have been augmented to meet customer needs will help in understanding how the company has managed to counter barriers associated with attaining competitive advantage at the expense of product augmentation (Dallasega, Rauch, & Matt 2015).
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Information barrier is one of the backlogs when it comes to product augmentation. This is a barrier that inhibits flow of information from customers to the company and from the company to the customers. Information is significant in this case, especially when launching a new product in the market. Information is the reason as to why customers will develop a positive attitude towards the product and hence tend to make their purchase decisions. Tecno Mobiles Company for example has a cycle of product launching whereby the smartphones and tablets come with new feature that are appealing to potential customers. Information barrier leads to wrong information about the product on potential customers who will in turn develop a different perception about the product. Information also impact on the production especially for a firm that relies on information from the market in order to carry out production and hence supply, wrong information could result to inefficiency in production process.
Technology has made it easy for information flow from and towards potential customers, with efficiency in the use of the Internet to market products, companies have been able to counter information barrier. This is because there is a chance to communicate with customers and they can air their views and opinions towards a particular product. Customer relationship management has been enhanced through the smooth flow of information.
Process barrier is another inhibitor towards achieving the goal of demand and supply integration. This is because every product has its life cycle and it begins from the inception of the product to consumption and use of the product or service. The process in which a product goes through has its challenges and that is where firms face the challenges of synchronizing the forces of demand and supply. When launching a new product in the market, it is important to consider the challenges that it will go through before it is fully accepted and appreciated by customers. For example the launch of Tecno Phantom 7 by Tecno Mobile Company, the product is augmented since it is the original product with advanced features and the company expects that customers will appreciate it more. The new smart phone has to undergo a process that will guarantee its purpose to a consumer. The same case, when the product is under the process, the company will strive to ensure that it meets the demand by supplying enough to the market. Process barriers could involve denial of the product in the market which results in loss to the firm, denial occurs when the product does not meet the standards of a product that should exist in the market. It could also be denied because the features of the product are not of high quality and hence the demand will be low. Other process barriers could involve low supply in the market and lack of enough raw materials to enhance the product.
Relational barrier also prevents augmented product to gain a competitive advantage because it results to slow rate of market penetration. It describes the importance of the product in relation to customer satisfaction. Demand for certain product triggers the supply of that particular product. When there is no relationship between the product demanded and the product supplied in the market, it leads to relational barrier. A product could be augmented and it fails to meet the needs of the customer. In this case the firm will conduct a market research in order to determine the taste and preference of potential customers who will create demand. Customer relation also plays a major role when synchronizing demand and supply such that where there is a poor customer relation; the firm is likely to experience low volume of sales. When a product is introduced to the market, it is at a very sensitive stage that requires constant attention from the company. Attention will therefore come in the form of customer relationship management and the constant approaches to build a long term relation with potential customers. It’s all about activities done to attract and retaining customers.
In order to attain a point of demand and supply integration, firms need to overcome the above barriers by developing and implanting strategies to ensure that the barriers are minimal to cause an impact in the synchronization. Tecno Mobile Company should, therefore, implement strategies such as embracing the use of technology especially in marketing of products or service. This is where online marketing and network marketing are applied especially to a newly introduced product in the market. Effective online marketing strategies enhance integration process, as it gives an opportunity for the company to reach potential customers globally which is essential for enhancing information sharing. Sufficient information about the market is also another solution to overcome the barriers, a firm that relies on sufficient information about the target market will find it easy in setting strategies to introduce the new product. Information could be obtained through conducting a market research to determine factors such as customer preference, population, income and competitors approach.
Investing in customer relationship management will also inhibit above barriers, a company that focuses on ensuring that customer needs are satisfied through investing in quality customer care service can attain the demand and supply integration. This is because a customer will always feel appreciated and there will be establishment of a long term relationship. When there is a long-term customer relationship, the firm is likely to experience continuity in the cycle of revenue because established customers will always demand the products from the same company. Customer relationship manage also helps in gathering information on how to further improve the quality of the product and hence develop strategies to enhance quality production and supply of a product or service.
Reference
Dallasega, P., Rauch, E., & Matt, D. T. (2015). Sustainability in the supply chain through synchronization of demand and supply in ETO-companies. Procedia CIRP , 29 , 215-220.
Fleisher, C. S., & Bensoussan, B. E. (2015). Business and competitive analysis: effective application of new and classic methods . FT Press.
