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What is the primary purpose of demand analysis?

To establish vendor qualifications

To estimate customer demand for a product

The primary purpose of demand analysis is to estimate customer demand for a product. This process involves researching and interpreting data related to consumer preferences, buying habits, and market trends to forecast future demand accurately. By understanding how much of a product consumers are likely to purchase, organizations can make informed decisions regarding production levels, inventory management, and marketing strategies. This estimation is crucial for aligning the supply chain with consumer needs, thus optimizing resources and maximizing profitability. Such insights can significantly influence strategic planning and ensure a company is well-prepared to meet market demands effectively.

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To determine product pricing levels

To analyze supplier cooperation levels

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