People have unlimited wants and there are limited resources, so people have to make choices on what to buy with their income by evaluating marginal benefits and marginal costs. I would like to share my thoughts on a craze of today...healthy food, in this case, healthy snacking...on ice cream. Everybody these days seem to want low Carb, low fat, sugar, calories..low everything, if not sugar free calorie free, etc. Consumer's tastes are changing to this healthy ice cream ( for example, my employer, D'Lites). This change in demand has been triggered by Americas need to decrease the obesity issues or people who are just trying to lead healthier lifestyles, which is understandable, everyone deserves a treat sometime. As people become more health conscious D'Lites is growing more and more. Therefore there is a shift occurring to the right on the D'Lites demand curve per se.
With that being said, I would like to add that I took notice to a new ice cream shop that has opened up a mile away from D'Lites. My first thought was "ooohh..competition"; But theres nothing wrong with that, competition is a main aspect in a market economy, and many aspects come in to play, such as taste which I've previously talked about, price, demand, supply, income, many things really. Specialization also is a key point. D'Lites specializes in Healthy ice cream and other healthfood products and this new shop does not, so in the long run that could be an advantage if that's the direction that consumers tastes stay in, which for now im predicting that it will, but who knows.
Your posting about the product ice cream and the fact that new "copetition" opened just a short distance away is an exhibit of one of the main components of microeconomics. Your shop has 'healthy' ice cream and have marginalized that your business will be affected yes, but in a projected positive way. The vehicle is the economic perspective of Scarcity and Choice. An ice cream customer in their shop who really wants 'healthy' ice cream, stands with a dilemna in that the shop he is in has a scarcity of healthy ice cream, presenting choice. If he was informed already of your shop, then he/she could make the choice to leave that one and come to yours. But will first weigh time, travel, cost balance, taste, memory of experience, and others in making Choice based on their new Scarcity dilemna.
ReplyDeleteThat was an interesting observation you made. I wonder if we are really attempting to change our lives and be more health conscious, or is it just a fad among people that can afford to buy higher priced items at health food stores. No one wants to be obese. How many people are really trying to be healthier? I think the craze has to do with the images that are thrown at us everywhere we look. Businesses like that are smart enough to find areas where demographically people have more expendable income and market to the most fashionable consumers. It is a wise move especially for an ice cream store. People will try to be movie star fit and pretty until the wheels fall off. Buy stock now.
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