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The Industry life cycle denotes the evolution of the industry from the different stages it has to go through based on the characteristics of businesses involved in the industry. Some industries which are in their prime grow fast whereas those in maturity grow slowly.

What Is the Industry Life Cycle?

The industry life cycle represents the entire evolution, channelization, and saturation of industry or any business.

It typically has four stages which are the introduction stage, the growth stage, the maturity stage, and the decline stage. Through all these stages, an industry goes through its struggle to maintain at the top and in the end, it finally settles down.

Stages of the Industry Life Cycle-

The Introduction Stages- The introduction phase is also called the start-up stage.

The Growth Stages-

After the experience of the start-up stage, the companies or the industries get a firmer hold of the market in the growth stage. Although making a lot of profit is not the primary concern for the companies at this stage. Mostly they are invested in research and development of their products. Also, new products are launched for the further development of the industry.

Maturity Stage-

In this stage, the company starts to make a significant profit. They have their maximum revenue and cash flows as well.

In this stage, the customers are very much acquainted with the products of the company and the marketing is top-notch. As a result, the products become very popular in the market. Thus the demand is very high at the mature stage. As a result, the company reaches its top-game during this time.

Decline Stage-

This is the last stage in the industry life cycle. In this cycle, the costs become counter optimal, and the sales also decline. In this stage, the industry is no more able to support the growth in the market. Also, the revenues keep on declining during this period. The weaker competition is forced out of the market in this decline stage. In all, making the profit becomes very challenging in the decline stage.

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