Question

Why is it valuable for retailers to understand the complexity of the standard-of-living concept? Justify your response.

Answer 1

Answer: The concept of standard of living relates to the level of wealth, comfort and the necessities that are available to certain socio economic classes and people living in certain area. The standard of living has a direct relationship with the sales of the retailers. The standard of living defines the type of products that will be in demand at the retailer. For example if the customers of the retailers have high standard of living then they will demand the premium quality products while if the standard of living is low then the demand for economical products will be more. But the concept of standard of living is not so simple and it involves many factors apart from income like the life expectancy and the economic opportunity and soon that is available to the people. Thus the standard of living not just impact on the demand at a retailer in terms of income level but it also in other ways also. Hence in order to understand the requirements of the customers and for developing a suitable inventory a retailer needs to understand the complex city of this concept. This is valuable for the retailers as it enables them to create a better and suitable offering for the customers and increase the sales and reduce wastes.