Life-Cycle Projection

There are four main stages of life-cycle which are pioneering, growth, maturity, and renewal. Pioneering stage consist of introducing new and innovative products in the market. As in this situation, the products are new to the world and do not have any direct competition when they appear. During this stage, sales are expected to have a slow growth and cash flow could be negative, it is happened because in this stage companies are dealing with the risk and uncertainty of their business in the future. Moreover, during the pioneering stage, firms focus on identifying what customers want. After a while dealing with the risk, the product may moves from the pioneering to the growth stage when they have a rapid growth in the sales in the pioneering stage. In this stage, due to the strong market growth, new competitors are attracted to enter the same market. The competitor are the one who may imitate and take account of our profit and market share. During this stage, companies usually continue to innovate the product in order to remain ahead of imitators because without continued investment, imitators may reach the stage of product parity, leaving the pioneer with no competitive advantage. Inadequate attention to continued product and market development in the growth stage may shorten the life cycle and dissipate any leadership position obtained. When the rate of sales growth slows down, and the sales are getting stable the companies are entering the maturity stage. During the maturity stage purchasing patterns and distribution channels stabilize, as a result of which a substantial increase in share by one company at the expense of other is strongly resisted. Environmental changes e.g. government regulations, changes in customer buying patterns or general macroeconomic conditions may speed up the pace of the business in entering the renewal stage. The main challenge is at this point because innovation is crucial to the business in this stage for the long-term success and the ability to renew themselves. During the maturity stages, all the companies in the business system devote much effort to microsegmenting their markets, creating close, supportive ties with customers, and building relationships.

Our projection for Niverplast’s machine in Indonesia which takes 5 years period of time will reach the growth stage of a product which is shrimp packaging machinery. In the pioneering stage, it can be counted as a time for our consumers to adapt and as a period of learning process in using that machinery optimally. The core objective to be done in 3 years of pioneering stage is mainly increase the awareness by being informative to our potential customers. In the growth stage of PLC, as the product becomes accepted by the market, we are aiming on increasing brand loyalty by keep improving brand loyalty of our consumer. It can be done by giving superior after sales service and improve

product quality. As it stated above which informs 5 years of projection, it will reach the growth stage, however if we continued to do a projection for more than 5 years, maturity stage and renewal stage will be analysed. In the maturity and renewal stage the product will be experiencing increased competition by other companies or threat of being imitated, and on this stage we will change our price and promotion strategy. We will possibly reduce our pricing and promotion strategy, however in this stage, while we change our existing pricing and promotion strategy, we create and develop new product with different approach, pricing and promotion strategy to extend the life cycle of the automated shrimp packaging machine.Market Share Projection

As mentioned previously, our objective is to achieve 40 percent of market share in five years. However, considering the fact that it might take 3 years for the pioneering stage, market share increase might not be the same for each years. Assuming that there are approximately 120 big and medium companies operated in the industry, the projection of the increase of the market share as followings: