"A product life cycle has three
distinct stages, namely; new product, maturing product, standardized
product." Raymond Vernon
Raymond
Vernon, a Harvard Business School professor, developed the product life cycle
theory. In the 1970s, Raymond Vernon introduced the notion of
using a product's life cycle to explain global trade patterns, in the field of
marketing. According to theory, as the demand for a newly created product
grows, the home country starts exporting it to other nations. When the demand
grows, local manufacturing plants are opened to meet the request. Moreover, the
scenario covers the whole globe from time to time, thus making that product
standardization.
From
the fact of the Raymond Vernon product life cycle, the actual third stage of
the product should be the decline stage, actually, anything starts, grow, and
matured then the final stage is demising. Therefore, from the discussed
Vernon's third stage of the product life "Standardization" refers to
the acts of looking to the outside market where the same product might become a
new one, thus avoiding its demise stage
Now,
from the fact of product life cycle international trade theory the local
businessman/entrepreneur can
enhance their small/simple business capital
formations to a more diversified and complicated form of business, particularly
the company initiative
It's
true that most small businesses tend to save the local community, as the small
scope of operations, then at a time the business override and reach the peak
'the maturity stage' it should probably decline as the next stage of its cycle
of life. Most of these businesses fail/die because of the failure of the
entrepreneur to seek another market where their product/service might go to
renew the rule of thumb.
As
the small business operates in a single local market, then after the business
boom; this means the next stage refers to the business's demise. For the
business rescue, the entrepreneur should now need to search for another market
for his/her business, and for this case, the market does not need to be
international markets rather the changing in the location within the same
district, region, or country
For
example, the booming business in District A in a country ABC should now
establish the same business as the branch service in probably another location
in A district, or in Region D in the same ABC country; this will play a big
role in updating the business product life cycle to standardization.
This
is just a simple way for the small business owner to escape from the rapid
decline of their business capital, but also the escaping way from a long time
doing business that fails to make the second birthday.