Understanding the PLC helps entrepreneurs in several ways:
- Resource Allocation: Knowing which stage a product is in enables better allocation of resources. For instance, heavy marketing spend is more critical in the introduction stage than in maturity. - Strategic Planning: Entrepreneurs can devise appropriate business strategies for each stage. For example, focusing on cost leadership during maturity and innovation during growth. - Risk Management: Awareness of the PLC helps in anticipating market changes and mitigating risks. Entrepreneurs can plan for product updates or replacements ahead of time.