Need/Demand

To make a credible case for use of an asset the need and demand for it must be well documented and evidenced. The market that the project is addressing must be clearly understood and defined both in terms of geography, in terms of the product or service and in terms of the potential buyers in that market. So for example if the plan is to let workspace to small businesses as part of the asset project, understanding the numbers of businesses and where they are that are likely to use space in the project and why, as well as their needs in terms of the facilities they will want and on what kinds of terms is very important.

It is at this point in the plan that the plans for measuring the social impact or returns of the project can be addressed. If a need has been identified that the project will address it is worth setting out how the impact on the need will be measured. This will be particularly important if the project needs to be acquired at less than best price as a transfer. Any public authority will want to see how the project will assist them in addressing community needs (see Section F of the portal).

Although collating evidence on need and demand for services that will be addressed by the project can sometimes be done through consultation with stakeholders it must be supported by hard data, particularly if the plan is to charge for services to individuals or to supply a service to individuals that is to be paid for by a public authority via a contract. So for example it is not enough to base a business plan on the fact that people or organisations want it, but also whether they are prepared to pay for it because a case has been made based on real evidence that there is a need or demand for it.

This data takes time to collect and analyse and may involve anything from a housing needs survey to getting advice from local estate agents or local authorities about the demand they have from customers for certain kinds of space or facilities.

Demand is important because it is a factor that affects, along with supply, how the price of things is set. If there is a lot of demand for something then the price can be set accordingly, if there is no demand then prices are affected. Similarly if there is a lot of supply then prices have to be set to take account of this or the service needs to be reconfigured so that the service offers more than other suppliers.