Industry Life Cycle

INDUSTRY LIFE CYCLE

1.     Pioneering/ Introduction stage: Introduction of new product

2.     Expansion/ Growth stage: overcoming the problem to improve financially and competitively

3.     Stagnation/ Maturity stage: stagnation to have a new life cycle

4.     Decay/ Decline stage: decline death signals and implement proactively

Industry forecasting Methods

1.     Market profile: no of establishments, geographical locations, value if sales etc.,

2.     Cumulative methods: based on statistical measurements. a. Surveys: Carried by researchers, consultants

b. Correlation and regression analysis: Demand measurements

3. Time series:

a.     Trend(T): Result of basic development in population, capital formation and technology

b.     Cycle(C ): Helps in intermediate range forecasting( wave like movement of sales)

c.      Seasons( S): Sales movement within a year

d.     Erratic Events: Unpredictable events as strikes, riots, floods etc.,

INDUSTRY CLASSIFICATION

1. Classification by reporting Agencies

¸       Under Reserve bank of India-industries- 32 groups

¸    Under SEBI- 10 groups

¸       Under Economic times-10 groups

¸    Under financial express- 19 groups

2.Classification by Business cycle

a.     Cyclic industries : Related to business cycle and changes

b.     Defensive industries: Products of having relatively inelastic demand eg., food processing industry

c.      Cyclical growth industries: Based on technical and economical changes eg., Airlines industry

3. Industry groups:

a.     Small size units: Small scale industries with a capital of 30 Lac will be listed in OTCEI

b.     Medium size units: Industry with a capital of 5 crores will be listed in the regional stock exchanges like cochin, Coimbatore etc.,

c.      Large scale units: Industry with a capital of 10 crores will be listed in BSE & NSE.

4. Input based Classification

¸ Chemical based products

¸ Agro based products

¸ Forest based products

¸ Metal based products

¸ Marine based products