Life Cycle Concepts

Product Life Cycle –


A product life cycle is a business analysis tool which attempts to identify a set of common stages in the life of various goods and services. It consists of four stages –


· Introduction – A period of slow sales growth as the product is introduced in the market. Profits are non-existent because of heavy expenses of product introduction such as advertising and promotions.


· Growth – A period of rapid market acceptance and earning of profits.


· Maturity – A slowdown in sales growth as the product achieves acceptance by most potential buyers. Profits stabilize or start declining because of an increase in number of competitors.


· Decline – Sales show a downward drift and profits decline.


Sunfeast Farmlite Biscuits is in the growth stage as it has started earning greater profits as compared to its introduction stage.











Brand Life Cycle -


The three phases through which brands pass as they are introduced, grow, and then decline. The three stages of the brand life cycle are the introductory period, during which the brand is developed and is introduced to the market; the growth period, when the brand faces competition from other products of a similar nature; and, finally, the maturity period, in which the brand either extends to other products or its image is constantly updated.


Sunfeast as a brand is also on the growth stage of the brand life cycle.



Industry Life Cycle –


A concept relating to the different stages an industry will go through, from the first product entry to its eventual decline. There are typically five stages in the industry lifecycle. They are defined as -

i. Early Stages Phase - alternative product design and positioning, establishing the range and boundaries of the industry itself.

ii. Innovation Phase - Product innovation declines, process innovation begins and a "dominant design" will arrive.

iii. Cost or Shakeout Phase - Companies settle on the "dominant design"; economies of scale are achieved, forcing smaller players to be acquired or exit altogether. Barriers to entry become very high, as large-scale consolidation occurs.

iv. Maturity - Growth is no longer the main focus, market share and cash flow become the primary goals of the companies left in the space.

v. Decline - Revenues declining; the industry as a whole may be supplanted by a new one.



The health biscuit industry as a whole is at the cost or shakeout phase, where the dominant players are emerging and economies of scale are achieved.