For the modern economy, the market of means of production is the most important system-forming link. It is necessary for the effective implementation of the functions of supplying enterprises with necessary resources. Further in the article we consider the characteristics of the market of means of production and its features.
General information
The market of means of production and capital is a complex of relations arising in the framework of the sale of material and technical resources.
The restructuring of the logistics system provides for the gradual abandonment of centralized funding and the rigid attachment of consumers to manufacturers and suppliers. Instead, there is a transition to free trade.
The market of means of production is a system of horizontal connections objectively existing between enterprises. It is based on competition.
Operating conditions
The market of means of production is formed and developed subject to economic responsibility and autonomy of producers. To do this, you need:
- Denationalization.
- Creation and development of the necessary market infrastructure.
The latter provides:
- Trading and intermediary activities.
- The provision of services in the sale of products.
- Providing information support. It is, in particular, the study of supply and demand, legal, scientific and technical consultations.
- The provision of production services: repair, installation, quality control, manufacturing of goods.
- Timely delivery of materials.
- Providing credit and financial and settlement services.
- Provision of resources for rent, leasing.
To implement all these functions, it is necessary to create an extensive network of intermediaries. These include wholesalers, commercial / service services, marketing centers, and commodity exchanges.
In addition, it is necessary to ensure:
- Freedom of economic entities.
- Legal support.
- Responsibility of market participants for the results of their activities.
- Free pricing.
- High level of staff qualifications.
Transition to the market
For the normal functioning of the market, you need:
- Creating a regulatory framework.
- Denationalization of trade, the formation of horizontal ties.
In addition, any monopoly should be eliminated. The means of production market (local market or regional trading platform) involves the realization of resources in different ways. For example, a plant can directly freely sell materials to a consumer, scarce goods can be distributed partially through intermediaries, or the entire volume of products can be sold in bulk.
The following stages of the formation of the market of means of production are distinguished:
- Elementary.
- The main (main).
- The final one.
Storage facilities
It acts as one of the key elements of the modern market of means of production. As calculations show, the level of warehouse efficiency must be increased by 30-35% as a minimum. The lag of this segment prevents the normal structure and volume of stocks in the national economy. Currently, most (about 80%) of the resources are held by consumers. To correct the situation, it is necessary to intensively develop the material and technical base.
Features of the initial stage
At the first stage of the formation of the market for production assets, material resources are saturated. It is carried out using the state distribution system or in the course of trade in the framework of pure competition in local markets.
The market of means of production includes:
- Sales services of material and technical resources.
- Supply Base.
- Leasing companies.
- Dealers.
- Specialized shops.
- Trade fairs.
- Thrift stores.
Sales and supply bases
In the market of means of production, regional, provincial, regional, republican supply bases can occupy their own segment. For this, the existing material and technical base (warehouses, shops) is used, and retail or commission sales are organized. Supply bases are considered a key link in the resource support system.
The market of means of production includes sales services. They carry out the wholesale sale of resources, establish direct contacts with intermediaries and consumers, research demand, market conditions, and make forecasts.
Stock Types
To ensure the continuity of supply of production assets to the market in the warehouses of suppliers should be a certain amount of products in the desired range. Such inventories are divided into seasonal, insurance and current.
The latter constitute the bulk of the total quantity of products in warehouses. It is due to them that the uninterrupted supply is predominantly ensured. Such stocks are periodically updated.
Seasonal stocks are formed depending on the specifics of the production activities of companies in need of production assets. For example, agricultural enterprises, especially those engaged in crop production, are characterized by the cyclical nature of their work. At each cycle, production must be provided with sufficient resources. So, field work is carried out mainly in the spring, summer and autumn. Accordingly, in these seasons the demand for fuel and lubricants is significantly increasing. In winter, as a rule, equipment repair is performed. Accordingly, this season spare parts and repair materials will be in demand.
Insurance reserves are designed to ensure the activities of enterprises in extreme situations (during a natural disaster, industrial disaster, etc.).
Market segmentation
Obviously, different consumers need different products. To meet a wide variety of needs, manufacturers and sellers identify consumer groups that are most likely to respond positively to the goods offered. Accordingly, enterprises primarily focus on their production.
In this case, it is very appropriate to recall the essence of the Pareto law. It is based on statistics. According to this law, 20% of consumers acquire 80% of a particular brand of goods due to various reasons (quality, appearance, etc.). The remaining 80% of buyers acquire only 20% of the product, most likely by accident. Owing to these features of the capital goods market, enterprises strive to orient their products to 20% of customers.
Thus, segmentation is the division of the market into consumer groups that need different products and to which various marketing methods should be applied. In turn, a market segment refers to a group of customers who react in the same way to the offered goods and marketing incentives.
Segmentation goal
The distribution of consumers into groups allows you to:
- It is better to understand not only the needs of customers, but also their individual characteristics (motives of actions, personal characteristics, etc.).
- Provide a better understanding of the essence and nature of competition.
- Concentrate different resources in the most profitable areas of their use.
When drawing up marketing plans, the features of specific market segments are taken into account. This, in turn, provides a high level of orientation of marketing tools to the needs of specific groups.
Segmentation Criteria
Their choice is carried out at the initial stage of distribution of consumers into groups. It is necessary to distinguish between the criteria for segmentation of the market for consumer products, industrial goods, etc.
When dividing the consumer market, demographic, geographical, behavioral, socio-economic and other criteria are applied. Geographical segmentation involves the division into administrative-territorial units - regions, cities, districts, etc.
In the distribution of consumers of the market of products for industrial purposes, are taken into account:
- Geographical position.
- Type of consumer enterprise.
- Volume of purchases.
- Direction of use of acquired production assets.
It should be noted that segmentation can only be carried out according to one criterion or when several criteria are sequentially taken into account. In the latter case, too small a division of the market must be avoided. Small segments are disadvantageous for commercial development.
Dealer Activities
Dealer - a commercial trading intermediary company that sells at its own expense and on its own behalf. Such organizations enter into relationships with consumers and manufacturers of production facilities on a contractual basis.
Recently, more and more dealerships are being created in the markets for production facilities. They are an open specialized platform on which products, a workshop, and a warehouse are located.
The dealer can represent in the specific region or municipality the interests of one or several manufacturers at once. His tasks include market research, advertising, the sale and maintenance of production facilities, repairs, the supply of spare parts and consumables, etc.
Leasing companies
These firms are firmly entrenched in the markets for production assets. Leasing companies provide enterprises with equipment and machinery for rent with the possibility of subsequent redemption. This form of resource acquisition is beneficial to many enterprises that do not have the financial means to purchase new equipment.
Additionally
One of the promising forms of sale of production assets is the sale of products through specialized stores. In addition, trade fairs have become very popular, at which partners meet and profitable agreements are concluded.
A promising direction in the development of the capital goods market is the creation of joint concerns, enterprises, unions, etc., with foreign counterparties.
Of course, not the last role belongs to a variety of rental centers. These market participants provide the satisfaction of the needs of small businesses, private entrepreneurs.
Conclusion
The market of means of production, like any other trading platform, is in constant motion: supply, demand, and the number of consumers and producers are changing. These and many other factors have a great influence on the parameters of the functioning of the market.