The product life cycle
For each stage in the product life cycle, different features
exhibit different behaviours. Normally, a product will follow
the generic product life cycle consisting of an introduction,
growth, maturity, saturation and decline phase
(Waters, 2002). The introduction phase and the decline
phase focus on service operations characteristics, whilst
the growth and maturity phases are underpinned by higher
volume with loss volatility and more predictable demand,
together with lower unit cost. According to the generic
life cycle theory, the introduction and decline phases of
the product life cycle require quick response, flexibility
and reliability in product design due to their high level
of demand unpredictability. Hence, the added service demanded
by retailers is for suppliers to deliver samples,
preproduction and additional volumes when actual sales
exceed planned demand in the decline phase. Conversely,
cost is the main driver in the growth and maturity phases,
where manufacturers need to reduce their production cost
in order to lower the unit price. The typical features