New Product Introduction Lifecycle

New product introductions can have serious effects on cash flow. A company ‚ s customers often know when a new product is going to be introduced in a marketplace . When a new product is coming out, many customers put off their purchase of the product in anticipation of the next release or a newer model. Revenues drop. Many customers also don ‚ t want to be the first to buy the new product in case there are software bugs , mechanical issues, or other problems. This hesitation further delays revenue and related cash flow. At the same time that customers are not buying the product at the levels they were previously, the company has to put out large sums of money to promote the new product. This additional marketing and sales expense further depletes cash.

New product introductions can be a very stressful time for a company, but these introductions typically follow a defined pattern within a fiscal year.

Important ‚  

Anything that you can do to identify the new product introduction cycle is important in knowing how to put your value in context. Even better, anything that you can do that shows how you have helped improve revenue or reduce costs during the lull in this cycle shows great value!

If you are internal to a company, finding out when the company is introducing new products or services is usually rather easy. If you don ‚ t know, a phone call or two can often tell you unless a new project is being kept extremely confidential to protect the company ‚ s competitive advantage. If you are external to the company, looking for patterns in old press releases, industry trade publication product reviews, industry analyst reports , or financial statements may be able to help you predict the next new product introduction. If you have a contact at your target organization or in the industry, you can always just ask. They may or may not be able to divulge information, but you ‚ ll be no worse off than if you hadn ‚ t asked at all.