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Homework answers / question archive / Americana, the food company decides to develop its Tuna can (weight, price, features, package, etc

Americana, the food company decides to develop its Tuna can (weight, price, features, package, etc

Economics

  1. Americana, the food company decides to develop its Tuna can (weight, price, features, package, etc.). List and explain briefly the stages of the new product development for the Tuna. What will happen to the tuna can sales and profits during each stage of the cycle in the figure below? (50 pts).
  2. When do you think it is best for companies to obtain a new product through acquisition strategy? – (10 pts).
  3. List and explain four types of store retailers and provide one example for each – (40 pts).

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The product life cycle essentially represents a chronological commercial longevity or life cycle of any particular product from the time it is introduced into the market until it is completely removed or eliminated from the market. The 4 common stages of the product life cycle sequentially includes introduction, growth, maturity, and decline. The initial or the first stage of the product life cycle is the introduction stage in which any particular product is formally launched or released into the market. The introductory phase of stage of any product life cycle primarily involves a lot of uncertainties regarding the commercial future of the concerned product and the business organization or the product manufacturer is not completely sure about its potential commercial success or failure. Therefore, at this stage, the organization or the manufacturer invests substantially on the commercial promotion, advertising, and publicity of the particular product in order to gradually generate considerable consumer attraction and demand. Hence, in this specific instance, as the tuna can is introduced in the market and Americana invests considerably on the advertisement and promotion of the product in order to generate adequate consumer awareness and demand, it might practically increase the overall business cost or expense of the company much more than its initial sales revenue after the launch of the product in the market thereby adversely affecting its profitability. The next stage of the product life cycle is the growth stage or phase at which any particular product has already gained the initial consumer exposure and henceforth its sales is also gradually increasing among the consumers or buyers as the product becomes increasingly popular. Therefore, at this stage, the tuna can sales might experience a gradual upward shift as more people begins to buy it thereby contributing to the revenue generation of Americana and expanding the company profitability in the process considering that the adertisement and promotional costs or expenses are not that excessively high as in the introduction stage or phase. Hence, at the growth stage the company has an opportunity to gradually increase its profitability. The next or the third stage of the product life cycle is the maturity stage at which the product sales has reached its saturation point that tends to decline or drop thereafter. In this instance, as the tuna can sales recahes its maturity period or stage the company can practically maximize its overall sales revenue and extract maximum profitability, given a particular level of the overall business and operational cost of the company. As the tuna cans approach deeper into the maturity stage, the can sales gradually begin to drop or fall and so does the company's sales revenue and overall profitability pertaining to the new tuna cans. The subsequent or the final stage of the product life cycle is the decline stage where the particular product experience a substantial decline in its sales as the consumer demand for the product drops or falls. Hence, at this stage the tuna can sales drops significantly as it looses consumer demand thereby leading to a considerable decline in the sales revenue of the company or Americana as well. The declining product sales at the product maturity stage can also be attributed to increasing market rivalry or competition for the product and the market share of the new product or the tuna cans also decreases notably thereby adversely affecting the company profitability at this particular stage.

Considering the fluctuations in the sales revenue of any new product and the connected economic profitability, it would be economically rational for any business organization or company to obtain and further promote any new product through acquisition strategy at the growth stage during which the consumer demand and the sales revenue of the product are increasing gradually and steadily. This would provide an immense opportunity to any business organization or company to considerably enhance its sales revenue and commercial profitability during the growth stage.

A retail store is a business or commercial organization which purchases various goods or commodities in a considerably large or bulk quantity from wholesalers and sell them in the consumer market to final consumers or buyers. One of the most common types of retail store or outlet is the departmental store which provides variety of goods, products, or commodities to the consumers or buyers at a particular place all under one roof. In a departmental store the consumers or buyers can conveniently obtain wide range of products or goods all in one place or under one roof. Some of the examples of departmental store include Macy's, K-Mart, Pantaloons, Shopper's Stop. Discount store is also another common type of retail store or outlet which provides also provides goods or products to the consumers or buyers at a discounted price. However, the discount stores offer relatively limited range of products or goods to the consumers compared to the departmental stores. One of the prominent and common examples of discount retail store is Walmart. Another type of retail store is supermarket which basically offers different household and food items to cater to the various domestic and household needs and demands of the consumers or buyers which are properly placed or assorted according to separate or distinct sections or departments. Examples of supermarket include merchandisers selling food and groceries, meat products, cereals, etc. The warehouse retail store is also another type of store retailer which sells limited stock or quantity of various products or goods at a relatively large or bulk quantity at a discounted price or rate to the consumers or buyers. An example of warehouse retail store is Costco in the US.

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