Question

What is the relationship of product life cycle and international business?

Answer 1

Product life cycle is a theorem given by raymond vernon says that during its life the product goes through many stages those being introduction, growth, maturity, saturation and decline. And during its initial stages the product stays in the region it was developed and during the subsequent stages it moves abroad to different countries with cheaper labour. This happens for many reasons a few of them being that the country where the product is developed usually has the resources for research and development and also it had the rich customer based for the product to be introduced and grow. So once the product matures and is settled it can now be manufactured with lower costs in countries with cheap labour and cheap resources and then it can be sold worldwide. That is how the product life cycle and international business are related. As when the product is in its growth period it can mature and it is ready to cater the international market and thats when we can expand it to the markets overseas.