Company, Industry, and Competitive Analysis: practice question
In the industry where Tessmark Retail operates, annual sales growth has slowed to roughly the economy's overall growth rate, demand is increasingly driven by replacement purchases, and price competition has intensified. This industry is most likely in the:
- growth stage
- embryonic stage
- mature stage
Show answer and explanation
Correct answer: C
Explanation: Growth that has converged toward the economy-wide rate, reliance on replacement demand, and fierce price competition are the hallmarks of the mature stage of the industry life cycle (after shakeout has removed weaker firms). The growth stage features rapidly expanding demand with improving profitability, and the embryonic stage shows slow sales, high prices, and little volume.
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