Ch.5 (Good and Services Selection) Flashcards
Product Decision
Product decision
The selection, definition, and design of products.
Product-By-Value Analysis
Product-by-value analysis
A list of products, in descending order of their individual dollar contribution to the firm, as well as the total annual dollar contribution of the product.
Product Life Cycles (and List 4 stages)
Those phases are introduction, growth, maturity, and decline.
Intro: products in the introductory phase are still being “fine-tuned” for the market, as are their production techniques, they may warrant unusual expenditures for (1) research, (2) product development, (3) process modification and enhancement, and (4) supplier development.
Growth: In the growth phase, product design has begun to stabilize, and effective forecasting of capacity requirements is necessary.
Maturity: By the time a product is mature, competitors are established. So high-volume, innovative production may be appropriate.
Decline: Dying products are typically poor products in which to invest resources and managerial talent. Unless dying products make some unique contribution to the firm’s reputation or its product line or can be sold with an unusually high contribution, their production should be terminated.1
