Non-price supply factors are those factors that have a significant impact on the formation of supply, as well as the price of a product on its volume.
These are:
1) The level at which the development of the production of this enterprise is located. It also refers to the quality of the use of factors of production. These include highly qualified specialists working in the company, well-functioning automated equipment, as well as good quality raw materials. If all of the above is kept under control, then a significant reduction in production costs can be achieved. Which, in fact, will not only improve the productivity of the enterprise, but also increase profits.
2) Non-price supply factors are, among other things, taxes with state subsidies. They also act as a rather significant condition affecting the proposal. These factors can both increase the costs of the enterprise and reduce them.
3) Another factor is the presence on the market of goods that are substitutes for the product produced by the firm. How, for example, can some forms of energy be replaced byartificial, which will help to reduce costs again.
4) The prices of inputs and factors of production are also non-price supply factors.
The aggregate supply and its factors are also quite important information that every entrepreneur or head of an enterprise needs to know. First, it is worth saying that it is understood as the sum of all existing individual proposals. In other words, it is the quantity, the quantity of all services and goods on the market.
Factors that affect aggregate supply:
1) Increase or decrease in commodity prices.
2) Growth or decline in the productivity of workers in the enterprise.
3) Changing the conditions on which the firm's business is based.
In addition to all of the above, I would like to note the factors that shape the quality of goods, since their role, like the rest, is important. The most important of them is the range of goods. It represents a certain number of any products that differ from others in specific features and characteristics.
The range is usually divided into four large groups. The first is the breadth of coverage of goods, the second is location, the third is the degree of satisfaction of needs, the fourth is allocated on the basis of the nature of consumer needs. In addition, two types of it can be distinguished: commercial and industrial. The latter is a set of goods that the manufacturer produces, taking into account the productionopportunities. It must necessarily be coordinated with the Ministry of He alth of the Russian Federation. But the trade assortment is goods, the formation of which takes place taking into account the specialization of the enterprise, as well as the existing technical base and consumer demand.
In general, non-price supply factors that affect quality are, of course, profitability and demand.
