Entrepreneurs guide production according to the needs of consumers. Remember that a good is a type of object whose definition is a subjective. The final consumer must expect that the good will improve his or her position enough that he or she actually purchases the good. The entrepreneur’s role is to provide that good to the consumer. Note the inherent difficulty in this role. Consumer demand is not inherently stable. Preferences are subject to fluctuations. Consumers can also be swayed by a competing products. Recently, producers of phones employing Android platforms have been facing steep competition from Apple. Many have switched to the iPhone6, and, as a result, Apple has reaped record profits. And let’s not forget about competitors that faded away long ago. Remember when Nokia was dominating the market for cell phones, only to have its gains swept away by smart phone providers? In serving consumer demands, entrepreneurs engage in a dynamic process of competition. Most entrepreneurs eventually fail!
Type of Learning Material:
Private / Unpublished