I don't think "the market" decides what's available in a bike shop. The suppliers take care of that. In the bike biz the few suppliers left wield enormous market power. They tell the LBS's what's available and the LBS pass it on to the consumers under the guise of "what they need". Most customers naturally don't know what should be available. They only know what's already in the shop and what the sellers recommend. And if the guy in shop says you need a mountain bike with front shocks for your trips to the store, that's what you're going to get. Not some fully fendered commuting wonder you've never seen or heard about.

The guy at the LBS gains nothing but frustration by telling her/his customers what they really need and then having to follow up with "...but nobody makes that".

Source: Countless conversations with the veteran owners of the two good LBS's in my area and young mechanics at sports shops.