• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Analyse the relationship between the product life cycle and cash flow.

Extracts from this document...

Introduction

Analyse the relationship between the product life cycle and cash flow The 'product life cycle' is split into 5 stages: * Research and development * Introduction * Growth * Maturity/Saturation * Decline The product life cycle is the model that represents a sales pattern for a product over a period of time. It shows the revenue by a product from is introduction to its eventual decline. There are four stages to the product life cycle: Introduction, growth, maturity and decline. Research and development is the first stage of the product life cycle. This is where a firm has a research team look in to possible new ideas and products for a business. ...read more.

Middle

The cash flow at this stage would not be very positive. A lot of money has been spent at the introduction to get the public to notice the product and to make them aware. The firm would not expect to make any profit at this stage as the product has just been launched. Growth: If the product succeeds, sales will grow. Prices could still be high but with increased competition prices will drop. The producer still advertises at a high level to fight off competition. Product starts to move into profitability. The cash flow starts to gain more revenue. ...read more.

Conclusion

Decline: Eventually the product will become less interesting for purchasers, and the decline of the product will commence. The revenue will now slowly drop but there is a possibility that the firm will not go into debt. My overall conclusion is that the relationship between the product life cycle and the cash flow are very similar. When the product life cycle starts to grow so does the cash flow as it does when the life cycle decreases. This is because If the product is selling more, than it is obviously going to have a greater cash flow. If the product is selling less then the cash flow will decrease with the product life cycle. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Marketing section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Marketing essays

  1. Is there scope for a new business in the local area?

    Gender Certain products are only brought by males, and some is only brought by females, so the advertising targets that group. Sometimes the a products are brought by both groups, but the advertising is just aimed at one. Region People in different areas of the country will buy different products.

  2. This project requires me to produce a imaginary business

    This is because in a job centre the advert will be seen by a number of people who want the job. I will also use my shop to advertise so that I can attract a person from the local area.

  1. E3 create a realistic rationale for the development of a coherent marketing mix for ...

    Distribution is about of the 4P's of the marketing mix. Basically distribution of channel just is a way of saying, how the products from me to the consumers. For my product to be effective, it should be available at the right place and at the right time.

  2. Our product is a toilet seat that lifts up with the step of a ...

    The diversity of products shows that this industry will accept innovations in toilet seats. We just missed the market because there is already a patented product, so we cannot get into the market with what we are thinking of. There is also a similar, complicated toilet that presents more problems

  1. Product life cycle

    We also gave out letters to form teachers so they could read out to their form class that there would be an ice cream sale on Thursday 29th September. Sales would be slow at this point but would increase dramatically because of the low cost goods.

  2. Define the product life cycle and for a product of your choice discuss the ...

    about the product and its benefits over other products such as the radio. Thus a lot of promotion is needed to inform potential customers about the advantages and uses of the new product concept. Consumers need to know the functions of the hi-fi, that it is run by electricity, about

  1. This project requires me to produce an imaginary business.

    Also if I ma going to try and have a price that is lower or the same as my competition then I will have to do research in to other prices. To do this it will require to spend time, into researching the local prices.

  2. This project requires me to produce an imaginary business.

    This also means that the advertising campaign will be different for each group. Use of product Domestic home users or business can use a product. This will influence the way that the product is sold and advertised. If selling to a business then the company may go direct to the business and sell face to face.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work