The Product Life Cycle

The PLC or Product Life Cycle is the cycle in which products go through when in the marketplace.

It includes:

1. Product Development:

Is the stage in which a company begins to develop a product. During development there is no sales and as a result the profits are always in the negative during this stage.

2. Introduction Period:

Is a period of slow growth as a product is introduced to the market, each pricing strategy will make this part of the curve look different; however, there are still no profit as the development stage must be paid off first.

3. Growth Stage:

Is a period of rapid market acceptance and increasing profits. The profits will allow for a more aggressive marketing strategy to be paid for and implemented and will push the curve into the maturity stage.

4. Maturity Stage:

is a period of slowdown and sales in growth and is also a time when the highest profits are made. the profits will level off as the market settles into a demand and supply curve and a price in which maximum revenue is made can be established. To prolong this stage marketing and money is needed in order to defend the products position in the marketplace from competitors and new products.

5. Decline Stage:

Is the period when sales begin to fall off and profits begin to drop. Is a time when new products can begin to be developed for production and the last bit of revenue be squeezed out of the marketplace for the existing product.