Finding and Analysis

Demand is the desire and ability to consume certain quantities of a good and service at certain prices at a particular point of time. It will only occur when we have the purchasing power.
The movement along the demand curve will only occur when the price of the product itself changes whereas for the changes in level of income, price of substitute and complements, taste and preferences, expectation in future price, health awareness, weather, population and festivals, it will shift the demand curve to the left or right depends on the changes occur.

Diagram 1 Factors that consider when buying clothes

Based on the diagram 1, there are four factors that determine the demand of customer on buying clothes, which are the price, quality, brand and preferences. The preferences have the highest percentage among the factors of demand which is 31%. It is because when a cloth meets the requirement of a customer such as the style, material or colour, they will tend to buy more and so the quantity demanded will increases.

The factor which has the least influence in considering to buy clothes is the brand. For consumers with low income, the brand of the clothes carry certain value that beyond their capability to purchase. Thus, they couldn’t afford to buy branded clothes causing the demand for it to be lower.

Meanwhile, the price of clothes and the quality share insignificant differential of 28% and 25%. It is because customers are sensitive towards the price changes and so they can only afford to buy clothes which have reasonable and affordable price. Additionally, the buyers are concern with the quality of the clothes. It is because people like to wear clothes which they will feel comfortable with throughout the whole day.

Chart 1.2 If your preferable choice of brand increased in price, will you continue to purchase their clothes?

The reasons given by those who choose ‘Yes’ are:

• Loyalty

• Fulfill satisfaction

 The reasons given by those who choose ‘No’ are:

• No purchasing power

On the other hand, for the theory of elasticity, one of the determinants is the price of the product itself. Based on the findings, most of the respondents will continue to purchase clothes from their preferable brand even though the price has increased. It is because they are loyal to the brand of clothes they have been purchased and so they are not elastic towards the price of their preferable brand. Besides that, clothes from consumers’ preferable brand can fulfill their satisfaction. This is because other brands might not have the suitable style or material that fit the customers.

Nonetheless, some respondents are not willing to purchase clothes from their preferable brand when the price increases. It is because they don’t have the purchasing power. These consumers have a low level of income and they only purchase goods that they really need, such as groceries, so that they can survive.

Chart 1.3 Would you purchase more clothes if your income had increased?

The reasons given by those who choose ‘Yes’ are:

• Fashionista

• More variety

• Able to purchase 

The reasons given by those who choose ‘No’ are:

• Save money

• It is unnecessary purchase

•  Selective purchase

• Purchase only when needed

Furthermore, people with higher income tend to have a higher purchasing power causing the demand curve to be inelastic. This is because they are not sensitive to the price changes of the product itself. There are also a few other factors that led to this result; one of them is fashionista. Consumers who are fashionista couldn’t live without having a change in their daily life style. They will catch up with the latest fashion and purchase clothes which will make them unique. Besides that, a variety of clothes is also one of the factors. Consumers like to wear different patterns and colours of clothes because it will make each and every day of theirs special and refreshing.

However, there are also respondents who are not willing to purchase more clothes even though their income has increased. This is because some consumers put their priority in saving the additional income rather than purchasing more clothes and they think that it is unnecessary to buy additional clothes.

Chart 1.4 If there is another brand selling clothes that are similar to your preferable brand but sold at a much lower price, will this change your choice of brand?

The reasons given by those who choose ‘Yes’ are:

• Save money

• Same satisfaction but at a lower price

The reasons given by those who choose ‘No’ are:

• Loyalty

Besides that, the availability of substitutes is one of the determinants of elasticity. The more substitutes the product has, the more elastic the demand. Most of the consumer will compare among the available products to purchase the product which can satisfied them at a minimal price.

Conversely, some respondents will not change their choice of brand because of loyalty. This is because consumers have purchased from their preferable brand for a long period of time and there is a strong connection between them.

The other factor of elasticity is the percentage of income spent. The higher the percentage of income spent, the more elastic the demand. Given an example, when a person’s expenses are high, this means that his or her spending will be limited and so he or she will be sensitive towards the price.