Product Life Cycle
When a product is introduced in a market it passes through a series of stages and the concept from launching of product till it is withdrawn is called as product life cycle. There are four stages in the product life cycle which is introduction, growth, maturity and decline. Each stage has a particular level of sales, profit and competition.
When the new product is launched costs are high due to sales promotion, research and product development. The customers are first time buyers and the success or failure depends on the promotional techniques adopted by the food service institutions.
As the market expands the first time customers become repeat customers and therefore sales and profit can be high.
In the maturity stage costs may increase as there is competition in the market and the growth of the organization may slow down if it is not managed properly.
The market becomes saturated with products and demand falls but the supply release in abundance. Therefore every food service organizations should try to be in the market by launching new foods or recipes according to the needs of the customers which will be constantly changing.