Demons have ridiculous mobility, due to at will Greater Teleport and plane shifting magic. If the party wants to win the fight, they must, must, MUST have a way to counteract this: either dimensional anchors (which have a decent chance of bouncing off spell resistance), ways to follow (for instance, a Mirror of Mental Prowess or a crystal ball and a few extra prepared portation dwoemers), or a hefty motivation for the demon to stick around. Without that, the demon will simply flee the scene. And next time, it'll be ready.