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than 10% if the price of the same is increased by 10%. But he further added that his business deals in
Business to business and the elasticity doesn’t exhibit as we learned the concept in textbooks. In Gyan
international the lower prices don’t always attract prospective buyers, nor the business customers will buy
the things which they don’t need today because of a expected price increase/decrease. They deal in fashion
industry which changes rapidly as consumers taste and preferences, their demand, needs and wants
changes. They compete with their competitors with price and non-price factors and comparatively increase
and decrease their price. It doesn’t affect the overall market demand, but they can expect how much
demand is flowing into their direction. And they also suspect the degree to which their customers will shift
their share in response to different prices and it is something which can be measured and utilised for
decision making.
The elasticity of the company product/services is elastic which means that the company goods and services
The demand is elastic which indicates that the percentage change in quantity demanded is greater than the
percentage change in price. In simpler terms the quantity effect dominates the price effect. That is why
even if there is a small change in price, there is a large effect on quantity demanded. So, the total revenue
would fall when there is an increase in price and would rise when there is a decrease in price.
The product/services are differentiated based on the following
Quality
Price Sustainability
Services
Promotion Design
Firstly, the products are differentiated based on prices. Though they deal in business to business, but
they try to retain their business customers by differentiating in prices from the other competitors. So
Other than price, they differentiate based on the quality. The cloth that they used in manufacturing is
100% sustainable and environmentally friendly chemicals which showed that the company is
They provide quality services which differ from their competitor lifelong creations private limited.
The company ships the consignment from Mumbai to UK and Germany. In case of any delays when
the consignment is aired from Indira Gandhi International, the expenses being borne by the firm if
delayed by them.
The company also differs in the promotional activities. To expand its business the firm, do indirect
promotional tools like making samples of different product category to receive more orders when the
buyers visits them. They also believe in effective communication and the owner itself goes and pitch
The company also differentiates in Design The brand is reputed to hold very differentiated designs.
The appeals differ in both quality and design from similar competitors. This gives customers