Supply and Demand and Cisco Systems

1. Discuss the nature of the market structure and the demand for Cisco’s products.

The nature of the market structure and demand of Cisco Systems is its business market which

contains fewer bvut larger companies. For Cisco Systems, this implies that even though they have

fewer clients than other companies, they still have a good and profitable relationship with their

clients. For the customers of Cisco Systems, this implies that they will receive better and faster

service and products because they don’t have to compete for the attention and service of Cisco

Systems.

The business market is derived from final consumer demand which means Cisco Systems must

know what the market demands from their business customers. For Cisco Systems, this implies

that Cisco must depend on the final consumer market, in order for their customers to buy their

supplies. This also means that Cisco Systems must also promote the products of their partner

businesses in order to get the final customers attention and loyalty to their partners in order for

them to get gain. For the customers of Cisco Systems, this implies that they would have to depend

on their customers choices if they are willing to buy their product or not. The demand of the

final customers would be the basis of the customers of Cisco Systems if they would ask for more

supply from Cisco Systems or not.

The business market’s demand is more inelastic, which means that it is not affected as much in

the short run by price changes. For Cisco Systems, this implies that they would not be affected

that much and their production of the supplies and demand for the supplies would remain the

same even though there are short run price changes.

2. Given the industries in which Cisco competes, what are the implications for the major types of

buying situations?

Straight rebuys—because Cisco deals in high-tech, there may be few truly straight rebuys. This