DUBLIN--(Business Wire)--
Research and Markets
(http://www.researchandmarkets.com/research/bbd2f1/the_20092014_worl) has
announced the addition of the "The 2009-2014 World Outlook for Dental Chairs"
report to their offering.
WHAT IS LATENT DEMAND AND THE P.I.E.?
The concept of latent demand is rather subtle. The term latent typically refers
to something that is dormant, not observable or not yet realized. Demand is the
notion of an economic quantity that a target population or market requires under
different assumptions of price, quality, and distribution, among other factors.
Latent demand, therefore, is commonly defined by economists as the industry
earnings of a market when that market becomes accessible and attractive to serve
by competing firms. It is a measure, therefore, of potential industry earnings
(P.I.E.) or total revenues (not profit) if a market is served in an efficient
manner. It is typically expressed as the total revenues potentially extracted by
firms. The "market" is defined at a given level in the value chain. There can be
latent demand at the retail level, at the wholesale level, the manufacturing
level, and the raw materials level (the P.I.E. of higher levels of the value
chain being always smaller than the P.I.E. of levels at lower levels of the same
value chain, assuming all levels maintain minimum profitability).
The latent demand for dental chairs is not actual or historic sales. Nor is
latent demand future sales. In fact, latent demand can be lower or higher than
actual sales if a market is inefficient (i.e. not representative of relatively
competitive levels). Inefficiencies arise from a number of factors, including
the lack of international openness, cultural barriers to consumption,
regulations, and cartel-like behavior on the part of firms. In general, however,
latent demand is typically larger than actual sales in a country market.
For reasons discussed later, this report does not consider the notion of "unit
quantities", only total latent revenues (i.e. a calculation of price times
quantity is never made, though one is implied). The units used in this report
are U.S. dollars not adjusted for inflation (i.e. the figures incorporate
inflationary trends) and not adjusted for future dynamics in exchange rates. If
inflation rates or exchange rates vary in a substantial way compared to recent
experience, actually sales can also exceed latent demand (when expressed in U.S.
dollars, not adjusted for inflation). On the other hand, latent demand can be
typically higher than actual sales as there are often distribution
inefficiencies that reduce actual sales below the level of latent demand.
As mentioned in the introduction, this study is strategic in nature, taking an
aggregate and long-run view, irrespective of the players or products involved.
If fact, all the current products or services on the market can cease to exist
in their present form (i.e. at a brand-, R&D specification, or corporate-image
level) and all the players can be replaced by other firms (i.e. via exits,
entries, mergers, bankruptcies, etc.), and there will still be an international
latent demand for dental chairs at the aggregate level. Product and service
offering details, and the actual identity of the players involved, while
important for certain issues, are relatively unimportant for estimates of latent
demand.
Key Topics Covered:
* 1 INTRODUCTION
* 2 SUMMARY OF FINDINGS
* 3 AFRICA
* 6 LATIN AMERICA
* 7 NORTH AMERICA & THE CARIBBEAN
* 8 THE MIDDLE EAST
* 9 DISCLAIMERS, WARRANTEES, AND USER AGREEMENT PROVISIONS
For more information visit
http://www.researchandmarkets.com/research/bbd2f1/the_20092014_worl
Research and Markets
Laura Wood, Senior Manager,
press@researchandmarkets.com
U.S. Fax: 646-607-1907
Fax (outside U.S.): +353-1-481-1716
Copyright Business Wire 2009
