When decline stage comes?


The last of the product life cycle stages is the Decline stage, which as you might expect is often the beginning of the end for a product. When you look at the classic product life cycle curve, the Decline stage is very clearly demonstrated by the fall in both sales and profits. Despite the obvious challenges of this decline, there may still be opportunities for manufacturers to continue making a profit from their product.

Challenges of the Decline Stage

  • Market in Decline: During this final phase of the product life cycle, the market for a product will start to decline. Consumers will typically stop buying this product in favour of something newer and better, and there’s generally not much a manufacturer will be able to do to prevent this.
  • Falling Sales and Profits: As a result of the declining market, sales will start to fall, and the overall profit that is available to the manufacturers in the market will start to decrease. One way for companies to slow this fall in sales and profits is to try and increase their market share which, while challenging enough during the Maturity stage of the cycle, can be even harder when a market is in decline.
  • Product Withdrawal: Ultimately, for a lot of manufacturers it could get to a point where they are no longer making a profit from their product. As there may be no way to reverse this decline, the only option many business will have is to withdraw their product before it starts to lose them money.

Benefits of the Decline Stage

  • Cheaper Production: Even during the Decline stage, there may be opportunities for some companies to continue selling their products at a profit, if they are able to reduce their costs. By looking at alternative manufacturing options, using different techniques, or moving production to another location, a business may be able to extend the profitable life of a product.
  • Cheaper Markets: For some manufacturers, another way to continue making a profit from a product during the Decline stage may be to look to new, cheaper markets for sales. In the past, the profit potential from these markets may not have justified the investment need to enter them, but companies often see things differently when the only other alternative might be to withdraw a product altogether.


Product Life Cycle Management

Many products going through the Decline stage of the product life cycle will experience a shrinking market coupled with falling sales and profits. For some companies it will simply be a case of continuing to manufacture a product as long as it is economically viable, but withdrawing it as soon as that’s not the case. However, depending on the particular markets involved, some companies may be able to extend the life of their product and continue making a profit, by looking at alternative means of production and new, cheaper markets. Even in the Decline stage, a product can still be viable, and the most successful manufacturers are those that focus on effective product life cycle management, allowing them to make the most from the potential of each and every product the company launches.



Stage 4 of Product Life Cycle – Stage of decline

1 product, 10 competitors, minimum profits, huge amount of manpower and resources in use – A typical scenario which a product might face in its last stage. In this stage the expenditures begin to equal the profits or worse, expenses are more than profits.

Thus it becomes a typical scenario for the product to exit the market. It also becomes advantageous for the company as the company can use resources it was spending on the declining product on an altogether different project.

Characteristics of Decline stages of Product life cycle

  1. Market is saturated
  2. Sales and profits decline
  3. Company becomes cost conscious
  4. A lot of resources are blocked in rejuvenating the dead product.
  5. There are only three options left with the company:
    • Re positioning or Rebranding of the product to extend product life cycle
    • Maintain the product as it is and reduce costs to get maximum profits till the product can produce profits
    • Take the product off the market.

Summary of the product Life Cycle

Characteristics of the Product life cycle

Stages Decline
1. Sales Declining Sales
2. Costs Low cost per customer
3. Profits Declining Profit
4. Customer Laggards
5. Competitor Declining numbers.

Objectives of Product Life Cycle

Stages Decline
Objectives: Reduce expenses & cut brands

Strategies of Product life Cycle

Stages Decline
1. Product Phase out weak products
2. Price Cut price
3. Distribution Selective phase out of unprofitable unit
 4. Advertising Reduce to retain hard core loyals
5. Sales


Reduce to minimum level





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