Supply Chain Management Over The Life Cycle Of A Product
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Supply Chain Management Over The Life Cycle Of A Product
A product's life cycle broadly includes four stages: Introduction, Growth, Maturity, and Decline. These stages are important for operations planning, marketing, pricing, and determining when to shift focus to new products. Planning operations effectively is crucial for success at each stage of the life cycle. Let's explore how demand forecasting and inventory optimisation can be carried out efficiently in each stage.
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Let’s take an example of a beauty business with online and physical locations nationwide. Their market research team identifies a demand for long-lasting lipsticks. After conducting thorough research and customer surveys, the company decides to create a line of long-lasting liquid lipsticks to gain a competitive advantage.
Stage 1- Introduction
The Introduction stage follows product development. Liquid Lipsticks are introduced to the target audience.They heavily invest in advertising to create awareness. Sales are initially slow as demand is being generated. The duration of this stage varies based on product complexity, novelty, and market competition. A product that meets customer needs usually succeeds in this stage.
What are the biggest goals at this stage?
- Forecast demand accurately to ensure product availability and create a good first experience.It is crucial to maintain optimal stock across all distribution centres and outlets.
- Plan effective promotional campaigns especially introductory offers to create brand awareness, product awareness and create demand. Emphasise more on the USP of the product - Long lasting formula.
How can we help?
Demand Sensing for New Products: Kronoscope associates the SKU - Liquid Lipsticks with similar/lookalike SKUs that are already existing belonging to the same product category/family. Using demand sensing mechanism, the system learns quickly from their demand patterns and predicts demand accurately for the new products. You can proactively identify customer needs and cater to them promptly even with limited data availability.
Events and Promotions Planning: Marketing campaigns can only be successful if you can deliver on what you promised to your clients.You can simply enter the duration, type of promotion and select liquid lipstick as a category to feed the promotion data into the system.
Kronoscope makes sure that you are optimally stocked to fulfil customers by accurately predicting the promotional uplift in demand. This data will then be used to forecast demand for promotions planning in future for products that are similar in nature.
Stage 2 - Growth
The next stage of the product life cycle is Growth where the sales start to pick up as the liquid lipsticks get recognised in the market. Here the production activities begin to speed up as the product is now available widely. This is when competitors enter the market with similar products. Product pricing and undisrupted production become important factors to succeed at this stage.
What are the biggest goals at this stage?
- Ensure undisrupted production activities for a smooth distribution across the supply chain.
- Set optimal prices that will help you compete with other players while also meeting your revenue targets. In some cases, you can also reduce prices to acquire new customers and boost sales.
How can we help?
Production and Raw Material Planning: Kronoscope automatically creates raw materials procurement plans at every manufacturing centre*SKU level. This is done by factoring in projected demand, current inventory, supplier lead times, fill rate, price, safety stock and open orders. This ensures that production activities continue smoothly even when there are several uncertainties.
Price Optimisation: Price Optimisation plays a vital role in retaining and acquiring customers amidst market competition. It can be a competitive advantage and contribute to gaining a significant market share. Kronoscope assists in achieving this by suggesting optimal prices at the SKU level, considering the impact on demand and revenue targets. It analyses the price elasticity of each SKU to provide valuable insights.
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Stage 3 - Maturity
During the maturity stage, liquid lipsticks get established in the market. Now, the production and marketing costs start to go down gradually. Brand loyalty is built and there are repeat customers now. The sales and profit for the product are at an all time high during this stage. This stage lasts longer than all other stages. As the product matures, market saturation begins.
What are the biggest goals at this stage?
- When sales are soaring high, it is important to be optimally stocked at all supply chain nodes. If you run out of stock, then you end up losing customers and revenue. On the other hand, overstocking can also lead to working capital getting tied up in the form of excess inventory
How can we help?
Automated Supply Planning: Kronoscope automates inventory planning end to end by creating automated replenishment plans at warehouse levels. This factors in crucial aspects like projected demand, current inventory, dynamic safety stock etc. The system also facilitates inventory rebalancing through inter warehouse transfers between warehouses to ensure optimal stock levels.
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Proactive Inventory Alerts:The Inventory Control Towers give you proactive alerts on potential out of stock losses and excess inventory wastage at SKU levels. This helps in quickly replenishing inventory at warehouses that are prone to stock out. This way, you don’t lose sales because you didn't have enough inventory.
Stage 4 - Decline
This is the final stage of the product life cycle. During this stage, sales start to decline as customer preferences change. Now people want more sustainable and cruelty free products. At this point, the company resorts to Harvesting - reducing all costs spent on it, including investments made in the product and marketing costs. By reducing these costs, the company hopes that the profits from the product will increase until their inventory runs out.
What are the biggest goals at this stage?
- At this point, you should not invest more money in a product that is declining. You should rather focus on clearing out inventory through price discounts or bundling it with other high selling products.
- It is also important to proactively look out for newer innovations and change in customer preference to develop new products or revamp existing ones.
How can we help?
Liquidation and Price Optimisation: As we saw earlier, Kronoscope gives proactive alerts on potential excess inventory which can be used to clear them before they expire. On top of this, it also recommends the best price at which the product can be liquidated so that it is profitable.
.png)
Managing a product throughout its life cycle requires careful planning and adaptation to changing market conditions. By understanding the unique characteristics and goals of each stage, businesses can optimise their operations and make informed decisions. In summary, Kronoscope provides practical solutions to help businesses navigate the product life cycle successfully. With Kronoscope's support, businesses can stay competitive, meet customer needs, and drive revenue growth throughout each stage of their product's journey.
.png)
Supply Chain Management Over The Life Cycle Of A Product
A product's life cycle broadly includes four stages: Introduction, Growth, Maturity, and Decline. These stages are important for operations planning, marketing, pricing, and determining when to shift focus to new products. Planning operations effectively is crucial for success at each stage of the life cycle. Let's explore how demand forecasting and inventory optimisation can be carried out efficiently in each stage.
Let’s take an example of a beauty business with online and physical locations nationwide. Their market research team identifies a demand for long-lasting lipsticks. After conducting thorough research and customer surveys, the company decides to create a line of long-lasting liquid lipsticks to gain a competitive advantage.
Stage 1- Introduction
The Introduction stage follows product development. Liquid Lipsticks are introduced to the target audience.They heavily invest in advertising to create awareness. Sales are initially slow as demand is being generated. The duration of this stage varies based on product complexity, novelty, and market competition. A product that meets customer needs usually succeeds in this stage.
What are the biggest goals at this stage?
- Forecast demand accurately to ensure product availability and create a good first experience.It is crucial to maintain optimal stock across all distribution centres and outlets.
- Plan effective promotional campaigns especially introductory offers to create brand awareness, product awareness and create demand. Emphasise more on the USP of the product - Long lasting formula.
How can we help?
Demand Sensing for New Products: Kronoscope associates the SKU - Liquid Lipsticks with similar/lookalike SKUs that are already existing belonging to the same product category/family. Using demand sensing mechanism, the system learns quickly from their demand patterns and predicts demand accurately for the new products. You can proactively identify customer needs and cater to them promptly even with limited data availability.
Events and Promotions Planning: Marketing campaigns can only be successful if you can deliver on what you promised to your clients.You can simply enter the duration, type of promotion and select liquid lipstick as a category to feed the promotion data into the system.
Kronoscope makes sure that you are optimally stocked to fulfil customers by accurately predicting the promotional uplift in demand. This data will then be used to forecast demand for promotions planning in future for products that are similar in nature.
Stage 2 - Growth
The next stage of the product life cycle is Growth where the sales start to pick up as the liquid lipsticks get recognised in the market. Here the production activities begin to speed up as the product is now available widely. This is when competitors enter the market with similar products. Product pricing and undisrupted production become important factors to succeed at this stage.
What are the biggest goals at this stage?
- Ensure undisrupted production activities for a smooth distribution across the supply chain.
- Set optimal prices that will help you compete with other players while also meeting your revenue targets. In some cases, you can also reduce prices to acquire new customers and boost sales.
How can we help?
Production and Raw Material Planning: Kronoscope automatically creates raw materials procurement plans at every manufacturing centre*SKU level. This is done by factoring in projected demand, current inventory, supplier lead times, fill rate, price, safety stock and open orders. This ensures that production activities continue smoothly even when there are several uncertainties.
Price Optimisation: Price Optimisation plays a vital role in retaining and acquiring customers amidst market competition. It can be a competitive advantage and contribute to gaining a significant market share. Kronoscope assists in achieving this by suggesting optimal prices at the SKU level, considering the impact on demand and revenue targets. It analyses the price elasticity of each SKU to provide valuable insights.
Stage 3 - Maturity
During the maturity stage, liquid lipsticks get established in the market. Now, the production and marketing costs start to go down gradually. Brand loyalty is built and there are repeat customers now. The sales and profit for the product are at an all time high during this stage. This stage lasts longer than all other stages. As the product matures, market saturation begins.
What are the biggest goals at this stage?
- When sales are soaring high, it is important to be optimally stocked at all supply chain nodes. If you run out of stock, then you end up losing customers and revenue. On the other hand, overstocking can also lead to working capital getting tied up in the form of excess inventory
How can we help?
Automated Supply Planning: Kronoscope automates inventory planning end to end by creating automated replenishment plans at warehouse levels. This factors in crucial aspects like projected demand, current inventory, dynamic safety stock etc. The system also facilitates inventory rebalancing through inter warehouse transfers between warehouses to ensure optimal stock levels.
Proactive Inventory Alerts:The Inventory Control Towers give you proactive alerts on potential out of stock losses and excess inventory wastage at SKU levels. This helps in quickly replenishing inventory at warehouses that are prone to stock out. This way, you don’t lose sales because you didn't have enough inventory.
Stage 4 - Decline
This is the final stage of the product life cycle. During this stage, sales start to decline as customer preferences change. Now people want more sustainable and cruelty free products. At this point, the company resorts to Harvesting - reducing all costs spent on it, including investments made in the product and marketing costs. By reducing these costs, the company hopes that the profits from the product will increase until their inventory runs out.
What are the biggest goals at this stage?
- At this point, you should not invest more money in a product that is declining. You should rather focus on clearing out inventory through price discounts or bundling it with other high selling products.
- It is also important to proactively look out for newer innovations and change in customer preference to develop new products or revamp existing ones.
How can we help?
Liquidation and Price Optimisation: As we saw earlier, Kronoscope gives proactive alerts on potential excess inventory which can be used to clear them before they expire. On top of this, it also recommends the best price at which the product can be liquidated so that it is profitable.
Managing a product throughout its life cycle requires careful planning and adaptation to changing market conditions. By understanding the unique characteristics and goals of each stage, businesses can optimise their operations and make informed decisions. In summary, Kronoscope provides practical solutions to help businesses navigate the product life cycle successfully. With Kronoscope's support, businesses can stay competitive, meet customer needs, and drive revenue growth throughout each stage of their product's journey.
Supply Chain Management Over The Life Cycle Of A Product
A product's life cycle broadly includes four stages: Introduction, Growth, Maturity, and Decline. These stages are important for operations planning, marketing, pricing, and determining when to shift focus to new products. Planning operations effectively is crucial for success at each stage of the life cycle. Let's explore how demand forecasting and inventory optimisation can be carried out efficiently in each stage.
Let’s take an example of a beauty business with online and physical locations nationwide. Their market research team identifies a demand for long-lasting lipsticks. After conducting thorough research and customer surveys, the company decides to create a line of long-lasting liquid lipsticks to gain a competitive advantage.
Stage 1- Introduction
The Introduction stage follows product development. Liquid Lipsticks are introduced to the target audience.They heavily invest in advertising to create awareness. Sales are initially slow as demand is being generated. The duration of this stage varies based on product complexity, novelty, and market competition. A product that meets customer needs usually succeeds in this stage.
What are the biggest goals at this stage?
- Forecast demand accurately to ensure product availability and create a good first experience.It is crucial to maintain optimal stock across all distribution centres and outlets.
- Plan effective promotional campaigns especially introductory offers to create brand awareness, product awareness and create demand. Emphasise more on the USP of the product - Long lasting formula.
How can we help?
Demand Sensing for New Products: Kronoscope associates the SKU - Liquid Lipsticks with similar/lookalike SKUs that are already existing belonging to the same product category/family. Using demand sensing mechanism, the system learns quickly from their demand patterns and predicts demand accurately for the new products. You can proactively identify customer needs and cater to them promptly even with limited data availability.
Events and Promotions Planning: Marketing campaigns can only be successful if you can deliver on what you promised to your clients.You can simply enter the duration, type of promotion and select liquid lipstick as a category to feed the promotion data into the system.
Kronoscope makes sure that you are optimally stocked to fulfil customers by accurately predicting the promotional uplift in demand. This data will then be used to forecast demand for promotions planning in future for products that are similar in nature.
Stage 2 - Growth
The next stage of the product life cycle is Growth where the sales start to pick up as the liquid lipsticks get recognised in the market. Here the production activities begin to speed up as the product is now available widely. This is when competitors enter the market with similar products. Product pricing and undisrupted production become important factors to succeed at this stage.
What are the biggest goals at this stage?
- Ensure undisrupted production activities for a smooth distribution across the supply chain.
- Set optimal prices that will help you compete with other players while also meeting your revenue targets. In some cases, you can also reduce prices to acquire new customers and boost sales.
How can we help?
Production and Raw Material Planning: Kronoscope automatically creates raw materials procurement plans at every manufacturing centre*SKU level. This is done by factoring in projected demand, current inventory, supplier lead times, fill rate, price, safety stock and open orders. This ensures that production activities continue smoothly even when there are several uncertainties.
Price Optimisation: Price Optimisation plays a vital role in retaining and acquiring customers amidst market competition. It can be a competitive advantage and contribute to gaining a significant market share. Kronoscope assists in achieving this by suggesting optimal prices at the SKU level, considering the impact on demand and revenue targets. It analyses the price elasticity of each SKU to provide valuable insights.
Stage 3 - Maturity
During the maturity stage, liquid lipsticks get established in the market. Now, the production and marketing costs start to go down gradually. Brand loyalty is built and there are repeat customers now. The sales and profit for the product are at an all time high during this stage. This stage lasts longer than all other stages. As the product matures, market saturation begins.
What are the biggest goals at this stage?
- When sales are soaring high, it is important to be optimally stocked at all supply chain nodes. If you run out of stock, then you end up losing customers and revenue. On the other hand, overstocking can also lead to working capital getting tied up in the form of excess inventory
How can we help?
Automated Supply Planning: Kronoscope automates inventory planning end to end by creating automated replenishment plans at warehouse levels. This factors in crucial aspects like projected demand, current inventory, dynamic safety stock etc. The system also facilitates inventory rebalancing through inter warehouse transfers between warehouses to ensure optimal stock levels.
Proactive Inventory Alerts:The Inventory Control Towers give you proactive alerts on potential out of stock losses and excess inventory wastage at SKU levels. This helps in quickly replenishing inventory at warehouses that are prone to stock out. This way, you don’t lose sales because you didn't have enough inventory.
Stage 4 - Decline
This is the final stage of the product life cycle. During this stage, sales start to decline as customer preferences change. Now people want more sustainable and cruelty free products. At this point, the company resorts to Harvesting - reducing all costs spent on it, including investments made in the product and marketing costs. By reducing these costs, the company hopes that the profits from the product will increase until their inventory runs out.
What are the biggest goals at this stage?
- At this point, you should not invest more money in a product that is declining. You should rather focus on clearing out inventory through price discounts or bundling it with other high selling products.
- It is also important to proactively look out for newer innovations and change in customer preference to develop new products or revamp existing ones.
How can we help?
Liquidation and Price Optimisation: As we saw earlier, Kronoscope gives proactive alerts on potential excess inventory which can be used to clear them before they expire. On top of this, it also recommends the best price at which the product can be liquidated so that it is profitable.
Managing a product throughout its life cycle requires careful planning and adaptation to changing market conditions. By understanding the unique characteristics and goals of each stage, businesses can optimise their operations and make informed decisions. In summary, Kronoscope provides practical solutions to help businesses navigate the product life cycle successfully. With Kronoscope's support, businesses can stay competitive, meet customer needs, and drive revenue growth throughout each stage of their product's journey.
A product's life cycle broadly includes four stages: Introduction, Growth, Maturity, and Decline. These stages are important for operations planning, marketing, pricing, and determining when to shift focus to new products. Planning operations effectively is crucial for success at each stage of the life cycle. Let's explore how demand forecasting and inventory optimisation can be carried out efficiently in each stage.
Let’s take an example of a beauty business with online and physical locations nationwide. Their market research team identifies a demand for long-lasting lipsticks. After conducting thorough research and customer surveys, the company decides to create a line of long-lasting liquid lipsticks to gain a competitive advantage.
Stage 1- Introduction
The Introduction stage follows product development. Liquid Lipsticks are introduced to the target audience.They heavily invest in advertising to create awareness. Sales are initially slow as demand is being generated. The duration of this stage varies based on product complexity, novelty, and market competition. A product that meets customer needs usually succeeds in this stage.
What are the biggest goals at this stage?
- Forecast demand accurately to ensure product availability and create a good first experience.It is crucial to maintain optimal stock across all distribution centres and outlets.
- Plan effective promotional campaigns especially introductory offers to create brand awareness, product awareness and create demand. Emphasise more on the USP of the product - Long lasting formula.
How can we help?
Demand Sensing for New Products: Kronoscope associates the SKU - Liquid Lipsticks with similar/lookalike SKUs that are already existing belonging to the same product category/family. Using demand sensing mechanism, the system learns quickly from their demand patterns and predicts demand accurately for the new products. You can proactively identify customer needs and cater to them promptly even with limited data availability.
Events and Promotions Planning: Marketing campaigns can only be successful if you can deliver on what you promised to your clients.You can simply enter the duration, type of promotion and select liquid lipstick as a category to feed the promotion data into the system.
Kronoscope makes sure that you are optimally stocked to fulfil customers by accurately predicting the promotional uplift in demand. This data will then be used to forecast demand for promotions planning in future for products that are similar in nature.
Stage 2 - Growth
The next stage of the product life cycle is Growth where the sales start to pick up as the liquid lipsticks get recognised in the market. Here the production activities begin to speed up as the product is now available widely. This is when competitors enter the market with similar products. Product pricing and undisrupted production become important factors to succeed at this stage.
What are the biggest goals at this stage?
- Ensure undisrupted production activities for a smooth distribution across the supply chain.
- Set optimal prices that will help you compete with other players while also meeting your revenue targets. In some cases, you can also reduce prices to acquire new customers and boost sales.
How can we help?
Production and Raw Material Planning: Kronoscope automatically creates raw materials procurement plans at every manufacturing centre*SKU level. This is done by factoring in projected demand, current inventory, supplier lead times, fill rate, price, safety stock and open orders. This ensures that production activities continue smoothly even when there are several uncertainties.
Price Optimisation: Price Optimisation plays a vital role in retaining and acquiring customers amidst market competition. It can be a competitive advantage and contribute to gaining a significant market share. Kronoscope assists in achieving this by suggesting optimal prices at the SKU level, considering the impact on demand and revenue targets. It analyses the price elasticity of each SKU to provide valuable insights.
Stage 3 - Maturity
During the maturity stage, liquid lipsticks get established in the market. Now, the production and marketing costs start to go down gradually. Brand loyalty is built and there are repeat customers now. The sales and profit for the product are at an all time high during this stage. This stage lasts longer than all other stages. As the product matures, market saturation begins.
What are the biggest goals at this stage?
- When sales are soaring high, it is important to be optimally stocked at all supply chain nodes. If you run out of stock, then you end up losing customers and revenue. On the other hand, overstocking can also lead to working capital getting tied up in the form of excess inventory
How can we help?
Automated Supply Planning: Kronoscope automates inventory planning end to end by creating automated replenishment plans at warehouse levels. This factors in crucial aspects like projected demand, current inventory, dynamic safety stock etc. The system also facilitates inventory rebalancing through inter warehouse transfers between warehouses to ensure optimal stock levels.
Proactive Inventory Alerts:The Inventory Control Towers give you proactive alerts on potential out of stock losses and excess inventory wastage at SKU levels. This helps in quickly replenishing inventory at warehouses that are prone to stock out. This way, you don’t lose sales because you didn't have enough inventory.
Stage 4 - Decline
This is the final stage of the product life cycle. During this stage, sales start to decline as customer preferences change. Now people want more sustainable and cruelty free products. At this point, the company resorts to Harvesting - reducing all costs spent on it, including investments made in the product and marketing costs. By reducing these costs, the company hopes that the profits from the product will increase until their inventory runs out.
What are the biggest goals at this stage?
- At this point, you should not invest more money in a product that is declining. You should rather focus on clearing out inventory through price discounts or bundling it with other high selling products.
- It is also important to proactively look out for newer innovations and change in customer preference to develop new products or revamp existing ones.
How can we help?
Liquidation and Price Optimisation: As we saw earlier, Kronoscope gives proactive alerts on potential excess inventory which can be used to clear them before they expire. On top of this, it also recommends the best price at which the product can be liquidated so that it is profitable.
Managing a product throughout its life cycle requires careful planning and adaptation to changing market conditions. By understanding the unique characteristics and goals of each stage, businesses can optimise their operations and make informed decisions. In summary, Kronoscope provides practical solutions to help businesses navigate the product life cycle successfully. With Kronoscope's support, businesses can stay competitive, meet customer needs, and drive revenue growth throughout each stage of their product's journey.
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