Mataracy
VIP Contributor
A' life cycle' is the period from birth or creation of an item to the end of its life. Products, companies and industries all have life cycles.
A product life cycle begins with its initial development and ends at the time it is eventually withdrawn from the market.
A life cycle is said to go through several stages. The 'classical' life cycle for a product, or even an entire industry,goes through four stages or phases.
(1) INTRODUCTION STAGE OR PHASE: during this stage of a product life cycle, there is some sales demand but total sales are low. Firma that make and sell the product incur investment costs and start-up costs. Running costs are usually high.
(2) GROWTH PHASE: during the growth phase, total sales demand in the market grows at a faster rate. New entrants are attracted in to the market by the prospect of high sales and profits. At early stage during the growth phase, companies in the market begin to earn profits.
(3) MATURITY PHASE: During the maturity phase, total annual sales remain fairly stable.prices and profits stabilise.The opportunity for more growth no longer exists,although the life of the product might be extended,through product updates.
More companies might seek to improve profits by differentiating their products more from those of competitors, and selling to a 'niche' market segment.
DECLINE PHASE: Eventually,total annual sales in the market will start to fall. As sales fall,so do profits too. Companies gradually leave the market. At some point in time,it is no longer possible to produce and sell the product at a profit, and the product is therefore discontinued.
All these face needed to be consider while producing a product in the company.
A product life cycle begins with its initial development and ends at the time it is eventually withdrawn from the market.
A life cycle is said to go through several stages. The 'classical' life cycle for a product, or even an entire industry,goes through four stages or phases.
(1) INTRODUCTION STAGE OR PHASE: during this stage of a product life cycle, there is some sales demand but total sales are low. Firma that make and sell the product incur investment costs and start-up costs. Running costs are usually high.
(2) GROWTH PHASE: during the growth phase, total sales demand in the market grows at a faster rate. New entrants are attracted in to the market by the prospect of high sales and profits. At early stage during the growth phase, companies in the market begin to earn profits.
(3) MATURITY PHASE: During the maturity phase, total annual sales remain fairly stable.prices and profits stabilise.The opportunity for more growth no longer exists,although the life of the product might be extended,through product updates.
More companies might seek to improve profits by differentiating their products more from those of competitors, and selling to a 'niche' market segment.
DECLINE PHASE: Eventually,total annual sales in the market will start to fall. As sales fall,so do profits too. Companies gradually leave the market. At some point in time,it is no longer possible to produce and sell the product at a profit, and the product is therefore discontinued.
All these face needed to be consider while producing a product in the company.
