Demand and Supply Analysis of Polo Mints in the UK Market

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Economics for Business

The assignment is prepared so that the knowledge regarding the demand and supply in the
market can be gained. The essay will be prepared which will explain the analysis of the demand
and the supply and their factors which help in determine the price of the Polo Mints in the UK.
There are many factors which affects the price of the product and the demand and supply
according to the certain market conditions (Kamyab, et. al., 2016). In this essay the equilibrium
will be explained by using the diagram, which is the intersection point for the demand and the
supply. There are many factors that lead to the change in the demand and supply which will be
explained in this essay. The concept of the economic factors will be explained in the detail which
will also help the manager in taking the decisions regarding the demand and the supply of the
market.
Supply:
It is the economic term which can be defined as the quantity of the product which the consumer
is available to buy from the market at the particular period of time. It can also be explained that
quantity which is available in the market by the seller (Varian, 2014).
(Figure: Shifting behaviour of demand and supply curve)
(Source: Toppr, 2019)

Demand:
It is also the economic term which can be defined as the number of the goods and services which
is available at the offered prices in the active market of the consumers. In the other words, it can
also be explained as the willingness of the consumers to buy the product at the offered rates from
the open market (Morgan, 2019).
(Figure: Shifting behaviour of demand and supply curve)
(Source: Toppr, 2019)
The concept of demand and the supply:
To maximise the profit in the Polo Mints it is important to understand the concept and the
relationship of the demand and the supply in the market. The price of the product of the Polo
Mint will be increment in the market when there is the enhanced in the demand and the supply is
declined (Varian, 2014). The prices will be declined in the market when the product of Polo Mint
has the enhanced supply and declining demand. For example, the prices of the product will be
enhanced in the market when there is the increment in the demand and the availability of the
product starts reducing. This will also impact the supply of the product as the supply will
increase the prices.
Equilibrium concept of the demand and the supply:

Equilibrium is the point in the market where the situations comes when the total demand is equal
to the total supply of the goods and services. In this concept of the economics the allocation of
the resources was easy and it also becomes perfect as the supply is enough in the market for the
consumption of the each individual. The concept of the equilibrium is available in the condition
of the perfect market as the suppliers are available in the active market and the consumers have
the sufficient goods to consume (Morgan, 2019). In the market of the UK, Polo Mint is the
competitive company in the product of the peppermint as there are many companies which are
selling the similar products so the situation of the equilibrium cannot be possible. There are very
rare chances when the demand and the supply of the company Polo Mint will be equal and the
company will reach to the point of the equilibrium.
(Figure: Equilibrium behaviour of supply and demand line)
(Source: Toppr, 2019)
From the above diagram it is concluded that the equilibrium arises in the company when the
demand and the supply of the product gets equal. The equilibrium is the pint where the line of
the demand and the supply is intersecting and their impact is shown in the price of the product.
Factors that leads to the shift in the demand curve:

There are the numerous factors which leads to the shift in the demand curve and are explained
below:
Change in the income of the consumer: The demand level of any product get affected by the
change or the alteration in the income level. The demand curve will be shifted to the right when
there is the increment in the income of the consumer as it leads to the increase in the availability
of the consumption of the products (Kamyab, et. al., 2016). Similarly if the income of the
consumer declines than there sit eh reduction in the demand and it results to the shift the demand
curve in the left.
The price of the Polo mint is the £0.60 which is very low and affordable by the consumers easily.
So the increment of the income will not affect the demand of the Polo Mint product but the
decrement in the income will affect the demand as people will reduce their spending in such kind
of the product.
Change in the consumer preferences: The market demand is get changes with the change in
the tastes and the preferences of the consumers. The taste of the consumers gets changes with the
market forces or the new products of the similar taste. The demand of the product shifts to the
right when the consumers like the taste of the product and vice versa (Henchion, et. al., 2017).
In the market there are different products are available of the Mint which includes the
peppermint and keeps the mouth fresh. As the consumers preferences changes rapidly in the
market because many alternative products are available for the Mint so the demand of the Polo
Mint is declining.

(Figure: Right side shifting behaviour of the demand curve)
(Source: Toppr, 2018)
Changes in the price of the related products: The demand of the product is also get affected
by the change it the rates of the related products as it impact on the price of the other goods. If
the price of the substitute product changes than there is the change in the market demands of the
product. For example: The competitor company of the Polo Mint which are dealing the same
products increases the price of the product than the demand of the Polo Mint products increases.
But if there is the decline in the price of the product of the competitors than the demand of the
Polo Mints also decreases.
Advertisement: If the advertisement is made at the good level than the demand of the product
gets increases. The demand curve shifts to the right when there is the efficient marketing is done.
The consumer get aware about the product when there is the investment is made in the marketing
activities as it helps in attracting the more customers (Toppr, 2019).
In the UK, Polo Mint is the famous product, so the demand of the product get increases as the
company has made the great advertisement. The demand curve will shift to the right as the
customers are attracted by the company.

Availability of the new product: As there are many products which are of similar nature and
ingredients which are also fulfilling the requirements of the consumers. As there sit eh active
competition in the market so demand curve shift to the left when there is large competition and
the availability of the new product enter in the market.
In the case of the Polo Mint, there are many products which are dealing in the mouth spray, mint,
chewing, etc. So, the availability of such kind of the new products declines the demand of the
Polo Mint negatively (Toppr, 2019).
Number of population: The demand of the product also gets affected by the number of
population living in the country. the demand of the product ge6t increases when there is the large
number of population as they demand more and vice versa. In the country UK, there is the large
number of population so they also demand more so he demand curve of many products shifts to
the right.
Due to the increasing population the demand of the product of the Polo Mint is increasing and it
is shifting the demand curve to the right. But there are some areas in the UK which are less
populated so the demand of the product is lower at those areas (Henchion, et. al., 2017).
(Figure: Left side (Declining) shifting behaviour of the demand curve)

(Source: Toppr, 2018)
From the above diagram it is concluded that there are the several reason which causes the change
in the demand. In the above diagram, the demand curve is shifting to the left and this is due to
the declining demand in the product of the Polo Mint. The demand is declining due to increasing
competition, due to the lower income of the consumer, due to the change in the tastes and
preferences and many other factors.
Factors that are shifting the supply curve:
There are the different types of the factors which are affecting the demand of the product which
are explained below:
Decline in the cost: the supply of the product gets affected due to the change in the production
cost. The production cost many be changes due to the many reasons such as the material cost,
wages rates, etc. the supplier increases the units of the supply when the cost of the production
declines, as at that pint the firm can maximise the profit. When in the production cost there is the
enhancing trend the suppliers try to control the supply of the goods.
The supply of the products of the Polo mint will be increased when there is the decline in the
price of the raw materials which are used to make the products of the company. This will decline
the cost of the product and the profit of the Polo mint will get to be increased.
Climate conditions: The supply of any product gets also affected due to change in the climatic
conditions of the country. If the climatic condition are in the favour of the product than the
supply of the product will get increased but if the climatic condition are not in favour than the
supply of the product will get decline. The bad weather conditions declines the supply curve.
In case of the Polo Mints the supply of the product is not get affected by the change in the
weather as none of the ingredients get affected by the change it the weather.

(Figure: Right side (incremental) shifting behaviour of supplier curve)
(Source: Toppr, 2018)
Technological innovations: The supply of nay product get increased when there is the
advancement in the technology and it shifts the demand curve towards the right. The supply of
the product get increased when the production increases and it is generally happen in the new
technology.
The supply of the Polo Mint gets increased when the company will use the innovation in the
production technology. The supply in the market will get increased when there is the
enhancement in the final output of the quantity.
Impact of related goods: The supply of the products also get affected due to the change in the
nature of the related products. For example: the supply of the product wheat is also get affected
due to the increase in the price of the rice as the farmers will more tend to grow the rice.

Source: Economics.org
Figure: Effect on the supply curve
Government regulations: The supply of any product is getting affected due to the change in the
government policies and regulations. The government policies and taxes have the great impact
on the supply (D'amico, et. al., 2014).
The supply of the Polo Mint will get increased if the tax rates starts declining and the final cost
of the product will be reduced. But if the tax rates start increasing than the final cost of the
product will also increase and it results in the decline in the supply of the Polo Mint.
Market price of the product: The supply of the product is also getting affected due to the
change in the market price of the product. If the market prices of the similar product is higher
than the supply of the product will get reduced and vice versa. A little change in the price has the
great impact on the supply of the product.

(Figure: Left side shifting behaviour of supplier curve)
(Source: Toppr, 2018)
The supply of the Polo Mints get declined when there are so many similar products which are
offering the lower price. The supply of the Polo Mints get increased when there similar products
will sell the product at the higher prices (Wadud, 2016).
Impact of the changes in the demand and the supply of the product prices:
 With the change in the price the demand get ups and down which ahs the great impact on
the Polo Mint. The demand of the product of the Polo Mint increases there will be the
increment in the prices of the products (D'amico, et. al., 2014).
 If there is the decrease in the demand of the Polo Mint than the prices will be similarly
reduced so that many consumers can get attracted to the lower price.
 If there is the change in the supply of the Polo Mint than the prices are also get affected.
If the supply of the Polo Mints products increases than the prices of the products will be
reduced as it creates the pressure on the sellers. The supply gets set off against the
decreased consumption.
 If the supply of the products of the Polo Mints starts declining, than the price of the
product will be relatively increase (Wadud, 2016). The company can maximise the profit
at this stage as shortage or decline in the product motivates the suppliers to raise the price
of the product.

The impact of the changes in the supply and demand on the price:
Source: books.lardbucket.org
Figure: impact of the changes in the demand and the supply of the product prices:
From the above discussion of the essay it is concluded that demand and the supply ahs the great
impact on the prices of the product. The change in the demand and supply has to be managed by
the company so that they earn the profit at the maximise level. In this essay the equilibrium point
is explained where the demand get equal to the supply of the product. There are many factors
that affect the demand and the supply of the product which is stated in this essay and its impact
on the price. In this essay it is clearly stated that if there sit eh shortage of the goods than the
price of the product will be increased but if there is no demand of the product in the market than
the price will be declined. In the case of the Polo Mint is the consumable good so its demand and
supplies get fluctuate according to the market conditions.