How do changes in consumer trends affect growth? - Vidyadip

Question

How do changes in consumer trends affect growth?

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Answer

The consumer trends affect growth because of following reasons:

Change in consumption pattern: Due to change in season or changes in income the consumption pattern of the consumer changes. With change in seasons some specific products are demanded more e.g. demand for umbrella increases during rainy season.
Change in income: With the rise in income, new types of products, costlier products are demanded by the consumers. Such demand forces entrepreneurs to produce new products. This leads to growth.
Some enterprises are closed down: With the changing consumption pattern some enterprises become obsolete and are forced to quit the industry. This affects the production of the enterprise and the growth.

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