The store became popular for offering quality products at low prices, and further store branches followed over time ,now there are two big stores .
2.1 DEMAND & PRICE
The demand for Kariaba's product is determined by the price of the product itself, the supermarket targets price sensitive or prise elastic consumers, this means that Kairaba is targeting customers who are not taste sensitive. Income is also very much of importance to the supermarket because it targets low income earners.
consumers of Kairaba are willing and able to purchase more of the supermarkets products at a low price and fewer products at a high price. This happens because, at higher prices, consumers have less money to purchase than at lower prices.
If the income of its customers goes down its demand curve shift to the left because customers may not have enough cash to buy the supermarkets product. Any changes of the above will cause a shift in the demand curve of Kairaba supermarket to either the right or the left, the demand curve of Kairaba is elastic.
The price of the product of Kairaba is marketing determined.
2.2 SUPPLY & PRODUCTION
Supply is flexible at Kairaba Supermarket, the supermarket decides on a price and it supply as much as its demanded at that price. The supply curve of Kairaba is Horizontal supply curve. Kairaba supermarket produce quality products at low cost ands supply it at a cheap price. Kairaba uses more of its fixed factors and have control over its variable factors.
The Factors of production of Kairaba are listed as follows: The store, Equipment Trolleys, computers, Management, full time staff, energy, Vehicles and Stock.
Kairaba is dominated by fixed costs because all its operation View More »