Why do manufacturers of products that are in the maturity stage of the product life cycle prefer to offer similar prices?
What will be an ideal response?
ANSWER: Maturity stage in a product's life cycle usually brings further price decreases as competition increases and inefficient, high-cost firms are eliminated. Distribution channels become a significant cost factor, however, because of the need to offer wide product lines for highly segmented markets, extensive service requirements, and the sheer number of dealers necessary to absorb high-volume production. The manufacturers that remain in the market toward the end of the maturity stage typically offer similar prices. At this stage, price increases are usually cost initiated, not demand initiated. Nor do price reductions in the late phase of maturity stimulate much demand. Because demand is limited and producers have similar cost structures, the remaining competitors will probably match price reductions.
You might also like to view...
An existing relationship changes negotiation dynamics because beyond discussion of the issues, negotiation is a way to learn more about the other party and increase interdependence.
Answer the following statement true (T) or false (F)
The planning method that appears to be becoming more popular is
A. bottom up. B. a combination of top down and bottom up. C. centralized planning. D. top down. E. sequential.
Pairs of conjunctions that are regularly used together to connect like elements are called _____ conjunctions
Fill in the blank(s) with correct word
After the passage of the Single European Act, the EU went from qualified voting to the requirement of unanimous consent
Indicate whether the statement is true or false