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Tuesday, 11 September 2018

The Mass Production And Surplus Economy



The discovery of improved production technology, accumulation of more capital and building of bigger factories, employment of more workers, and the push for increase in the productivity by computing capitalists for the purpose of exploiting the opportunities offered by urban population explosion and expanding trade set the stage for a rapid increase in the production of goods and services.

The standardization of products and their component parts, use of machines and automation in factories, supervision of factory hands by managers trained in work analysis, time and motion studies, and the introduction of shifts in working hours, and the sourcing of cheap raw materials from abroad or combined to ensure the mass production of goods and profilation of services. Since trade is now thriving well and merchant middlemen are available to help in distribution, goods are produced in large quantities in anticipation of demand. Because of the presence of many competing brands in the market and produces failure to properly monitor demand before production surplus results in the market. This type of surplus situation turns the market into a buyers' market.

 A buyers' market is a situation in which the buying party in an economic exchange dictates the tune of price and or some other exchange transaction factor as a result of surplus goods and services. It affords consumers the opportunity to choose from among many competing brands. In an attempt to beat competition, producers may upgrade the quality of their products as a means of attracting more customers. Where this fails to work they may embark upon aggressive promotion by way of sales promotion and personal selling. In this way in emphysis is placed on the volume of sales rather than on the value of sales or profit.

When this fails to achieve the desired goal of long-term patronage for producers goods and services, they begin to look for another means of beating competition and generating large patronage from consumers. This usually sets the stage for adoption and implementation of modern marketing programs which revolve around the consumer. 

    THE TERTIARY OR AFFLUENT SOCIETY STAGE.

The gains from division of labour and specialisation and industrial revolution during the secondary or industrial economic stage culminated in the emergence of an affluent society. An affluent society is one in which the basic needs of people for survival have been met and they can now afford to engage in conspicuous consumption. Because of the high discretionary income which the people enjoy, their standard of living are high and they expect more satisfaction from goods and services which they consume. With the increase in consumers disposable income and expectations and the existence of competition, it becomes difficult to please or satisfy them. Though the populous affluent society of consumer is geared towards a high level of consumption it is however very selective in the choice of brands and outlets. To be able to successfully exploit the opportunities in this type of economy producers discovered that they have to develop and utilize sophisticated marketing programmes. This leads to the emergence of modern marketing concept which puts the consumers at the centre of all production and distribution activities.


     In the territory or affluent economy, producers have to first identify prospective consumers' needs and satisfy them with the appropriate products and marketing programmes before they can get a meaningful share of the pie of consumers and enlarged income. Producers no longer produced before thinking about the market or consumers. The demand is stimulated and more than ever before, the stimulation is directed towards encouraging people to adopt the products which have been created to meet their needs. Marketing programs are employed to encourage consumers to raise their expectations, seek their rights, spend more and enjoy more comfort in life. As consumption increases, producing firms move closer to consumers, in order to be able to properly identify their needs, strive to develop the appropriate product offerings for satisfying them, and employ effective marketing promotional tools and complex network of wholesalers and retailers to deliver the products to them.

As time goes on, efforts are made not only to satisfy the present needs of consumers but to give consideration to their long-run benefits and the society's welfare as well. At this stage, marketing firms become very numerous and marketing is established as the dominating philosophy and duty of every member of producing firm.

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