Demand chain management — The new source of profit increase

The intersection of transaction cost economy, demand management and information technology shapes the framework of demand chain management theory. Demand chain management that emphasizes demand planning, value adding and demand chain optimization has enhanced the internal values of products and services, and thus evolved to the new source of profit increase. This paper starts with the background of demand chain management, then based on the connotation of demand chain management, analyzes why it is an instrument to increase business profit from three aspects. Finally, the paper discusses the potential problems of demand chain and the developmental prospect of demand chain management in China.