The cycle consists of four stages: Product Introduction, Growth, Maturity, and Decline. Once you determine what stage your product/service is at then you have to analyze how long it will take to get through the life cycle. This will allow you to assess the long-term need for your product/service.

 

Low	If your product/service is a fad
Medium	If your product/service has a medium term need
High	If your product/service is expected to have long term needs

 

If the long-term need is low then you should not go on with your venture; unless you are prepared to replace your product/service with something else once demand runs out. If the long-term need is low for your existing business then you must acknowledge that your product/service is a fad and plan for something else in the long-term. If the long-term need is high then go onto the next question.

 

Are resources sufficient to Sustain the Venture?

 

Up to this point in the assessment of your venture, if you have answered yes to all of the preceding questions it means you have a venture that is innovative, valuable, repetitive, and has a long-term need. So now it is necessary to assess whether you have sufficient resources to support your venture. Without sufficient resources, i.e., capital, raw materials, labour, etc., you will not be able to operate your business for long.

 

Low	If resources are too hard get or non-existent
Medium	If there are a small number of resources
High	If resources are abundant

 

If the level of resources is low, then you should not go on with your venture. If the level is low for your existing business then you are in danger of halting operations. If the level is high proceed to the next question

 

B) Can You Keep It?

 

4. Scarcity (Can it preserve scarcity)

 

Is it non-imitable?

 

How easily are competitors able to “copy” your product/service? What value do you add to your product/service that makes it harder for others to imitate? These are important questions you must ask yourself when analyzing whether your product/service is non-imitable. Competitors may be able to offer essentially the same product/service that you are offering, but there are still ways to differentiate yourself from your competitors. A distinct brand name, reputation for product/service quality, and first movers advantage are among many things that can differentiate you from competitors. That’s what makes you non-imitable. Take a look at West Jet airlines. This company was founded in 1996 and has quickly become one of the top airlines that customers prefer to fly with. They were able to differentiate themselves by offering low cost fares and providing fun, quirky in-flight experiences for customers. Although competitors began to offer low cost fares as well, they were unable to imitate West Jet’s customer service and did not have first mover’s advantage in the low-cost segment. West Jet is able to preserve its scarcity because it has developed a strong brand name and a reputation for high quality, fun, and quirky service.-->

 

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