Product Life Cycle And Industry Growth

- Nov 21, 2019-

Life cycle theory believes that the development of any industry is divided into four stages: the gestation stage, the development stage, the maturity stage and the recession stage. From the perspective of industrial growth, the industry can be divided into growth industry, mature industry, and recession industry. According to the meaning of the industrial life cycle and the characteristics of each stage, the growth rate of the industry can be judged from the growth rate of industrial product sales, the proportion of industrial output value to GDP, and the rate of change. The above three indicators are at different stages of the industrial life cycle. There will be obvious differences, and according to this analysis, the domestic carpet industry belongs to the development and growth industry.

Commercial carpets in China are steadily developing commercial products, and there is still much room for growth in the future driven by the real estate industry. It is worth mentioning that in recent years, the performance of China's home carpet market is more eye-catching. Personalized rug products are favored by young consumers.

After the carpet industry entered the growth period, the old customers repeated purchases and brought new customer sales surge. The profit of the company increased rapidly. At this stage, the profit reached a peak. With the increase in sales volume, the scale of production of enterprises has gradually expanded. The cost of products has gradually decreased. New competitors will compete. As competition intensifies, new product features begin to emerge, and product markets begin to expand in distribution channels. In order to maintain the continued growth of the market, companies need to maintain or slightly increase the promotion fee, but the average promotion fee has decreased due to the increase in sales volume.