New Business Opportunities and Product Life Cycle

This report discusses the new business opportunities that the production and marketing of electric cars may present to entrepreneurs and business executives. It also critically assesses other businesses currently linked to the global automotive industry that may not be profitable in the long run to invest in. The report explores the concept of product life cycle and its stages, as well as the value chain in the automotive industry.

New business opportunities
and product life cycle

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Identify new and emerging business opportunities that the production and marketing of
electric cars may present to entrepreneurs and business executives......................................3
Identify and critically assess other businesses currently linked to the global automotive
industry that you think it may not be profitable in the long run to invest in..........................5
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business opportunity is defined as ability to find out ways in which business may have
high growth rate within marketplace. These opportunities are adopted by business so as to get
high business sustainability and effective change management in order to cater more customers
by recognising their needs and meeting those needs by company’s offering. This aspect may
provide distinct market edge to the business as they are having something that could help mass
population in meeting their demands in effective manner. This report is based on Volvo cars
which is a premium car manufacturer company now they are willing to expand their market with
manufacturing of electricity based cars. The main objective of the company is to place
electrification at the core of its future business. So for this they have decided to fit electronic
motor within all their manufactured cars. This is the prominent step taken by the company so as
to embrace electrification and to highlight innovation in their internal combustion engine. This is
an emerging market trend within UK which is helpful for Volvo to position their manufactured
products within market in an effective way and grab market opportunities as well (Conley,
2016).
MAIN BODY
Identify new and emerging business opportunities that the production and marketing of electric
cars may present to entrepreneurs and business executives.
A business may have vast opportunities to grow within market which can be adopted by
business so as to get distinct position within marketplace and enhance market goodwill as well.
In this context Volvo is having high market opportunities to grow and to sustain for this they are
requisite to use some theories and tactics so as to develop their business accordingly. In order to
get success it is necessary that grabbed opportunity is having high success rate and innovation.
There are some business opportunities which can be adopted by Volvo so as to get business
success which is elaborated as under:
Internal combustion engine: This is a conventional internal combustion engine which is
not having any dependence over electric infrastructure. This consumes high fuel and exhaust

emission in high range. Due to this feature they are used by highly optimised and works within
on going processes.
Hybrid electric vehicle: These vehicles are having parallel configuration of electric and
ICE drive and these comes within optional plug in option which is called PHEV in technical
terms. ICE is known as primary mover of those vehicles which are supported by small electric
motor. Along with this these devices are having small battery which is charged by ICE. This
technology is used for small distance as it is having low speed in their vehicles (Goldsby and
Zinn, 2016).
Range extended electric vehicle: It is a hybrid configuration of electric drive and
casually it is having smaller battery capacity than BEV. This technology is helpful for moderate
distances in which vehicle can be charged from grid. This technology consists of small generator
as in comparison of BEV.
Battery electric vehicle: These are designed purely for electric drive and having large
battery capacity which contains Li-on technology. This can be used for small and medium
distances. This is having only a single charging battery which can be charged with grid stationary
(Kranz, 2016).
Fuel cell electric vehicle: This contains series of configuration of fuel cell system and
electric drive. It is based on fuel cell stack technology in which hydrogen tank pressure typically
350 or 700 bars and used for medium and high range distances.
By using these business model Volvo can expand their market and present these models
to entrepreneurs and business executive so that to grab more investments. There are some models
which are required to be followed by business so as to decide about business strategy. These
models are elaborated as under:
Product life cycle: When a new product is introduced to the market then it may have to
pass through from various stages and within these stages all the marketing decision are different.
These stages are differentiated into four categories i.e introduction, growth, maturity and decline.
It is said that every new product will have to pass from these four stages during its life span and

life of all the stages are different so it can be large or small as according to the success rate. The
stages of PLC have been explained underneath:
Introduction stage: Within this stage the business tries to establish product awareness about the
new product within marketplace. Under this stage a robust market plan is prepared with a
foremost objective of enhancing product awareness within marketplace and to provide a market
to the product. Within the context of electric car as it is having high demand within UK and this
is the target market for Volvo. So in order to position their product within market they are
spreading awareness about these products and enhancing knowledge about electric vehicles in
their customers (He, Luo and Huang, 2019).
Growth stage: This is the stage at which consumers know about the product and major
focus of the company is to build brand preference and enhance their market. Within this stage
quality is maintained and additional features can be added to attract number of customers. The
main objective of business in this stage is to broader their customer base and add more
distribution channels so as to fulfil market demands. With this context Volvo is focused to add
more distribution channels so as to enhance their market size of electric motor cars.
Maturity stage: This is the stage the product is recognised in the market but have lots of
competitors so within this stage primary objective of business is to enhance their profit and
differentiate their product from other rivals so as to get distinct market edge. Pricing strategy
within this stage is quite low as company is having intense competition with their rivals. In the
background of Volvo within this stage as they have so many competitors so they are keeping
their product on low price so as to maintain competition and they are continuously focused on
product innovation in order to maintain their customer base (Matsumoto and et. al., 2017).
Decline stage: This is the stage at which overall sales started to decrease and product
started to vanish from the market may be due to change in customers’ needs or due to low quality
or innovation. Under this stage companies try to innovate their product so as to save their
product or they can decrease its price with huge quantity. In this context Volvo is working to
make innovations in their product so as to keep their product running in the market.

Identify and critically assess other businesses currently linked to the global automotive industry
that you think it may not be profitable in the long run to invest in.
Every business is having two aspects when they unleash a market whether the business
will be successful or it will be a failure. There are so many reasons of failure of a business when
these aspects are not properly handled then this leads to business failure. Dyson is a British
vacuum cleaner manufacturer they decided to manufacture electric cars named Fantastic cars.
This venture did not give profits to this renowned company so they pulled the plug and collapsed
its production. The major reasons of failure of these cars are discussed as above:
Product diversification: Dyson is a renowned company of vacuum cleaner the company is
having sole manufacturing of this product. When they brought a new project in the market then it
was radically different for the customers so it was not easy for them to switch to a car which is
made by a vacuum cleaner company. This was the major reason of their failure as they were
more focused in proving themselves to be a car manufacturer rather than manufacturing quality
cars so as to enhance its sales and capture market(Hernandez and Pedersen, 2017).
High capital cost: The manufacturing process of car is required high capital investments
as Dyson had to face tough competition with other companies such as Tesla, Volkswagen etc. So
it was not easy for them to enter in this industry in low investments. This industry is in the need
of high innovation and investments which was not possible by Dyson. Dyson took all these
difficulties at secondary level due to which their product did not succeed in the market.
Lack of market research: Prior launching of their electric cars Dyson did not do well in
their market research. They did not pay high attention on this aspect and invested in this product
just by their emotional decisions. Their product was not commercially viable this was due to not
putting attention on market research. Due to this aspect Dyson could not perform in prominent
manner and lead their project to a collapse (Argente and Yeh, 2018).
Problems in development process: A car in manufactured through so many processes
and components and these are merged to manufacture high quality cars. In the context of Dyson
they could not arrange high quality components in their cars due to which their car faced
problem in development procedure. It was observed that these cars were not commercially viable
that means it had some technical defects such as inefficient engine and combustion system.

These factors lead the company to back step from their electric car segment and it was failed
during initial stage only(Godina and et. al., 2016).
Porter’s value chain: This is a concept which describes the methods by which a
company can add more value of their products within its customers. According to this concept a
manufacturing process is having two types of activities which are primary and supportive. A
product passes through all the activities and these activities add value to the product which can
help the customers to satisfy their needs at prominent manner. The major objective of this chain
is to add value to the product and minimise overall cost so as to earn high profits. In the context
of Volvo they can use value chain in their manufacturing activities so as to bring business
efficiency. The primary and supportive activities are elaborated as under:
Primary activities:
1. Inbound logistics: This involves relationship with suppliers and all those activities
which are involved in procurement of raw materials.
2. Operations: These are those activities which are used by Volvo to convert raw material
into saleable product which is their cars.
3. Outbound logistics: These are those activities which are used in rendering the product to
their customer. Within this context Volvo is using effective channels to distribute their
products.
4. Marketing and sales: These are the activities which are used by Volvo to encourage
potential customer to buy their product.
5. Service: These are after sale services which are given by Volvo so as to make their
customer satisfied.
Secondary activities:
1. Procurements: These are the methods which are used by Volvo to acquire their
inputs and resources.
2. Human resources management: These are activities which are used by Volvo so as
to hire and train their employees to get work efficiency in their business.
3. Technological development: These are associated with equipment and hardware,
software so as to get technical knowledge to transform inputs into outputs.

4. Infrastructure: This includes various department such as accounting, legal, quality
etc. within Volvo organisation (Silvia and Krause, 2016).

CONCLUSION
From the above report it can be concluded that business is having immense opportunities
to have business growth if all the factors are analysed in appropriate manner. In the path of a
product success it is having four stages to cross on. These stages are adapted by business and
accordingly strategies are implemented so as to see their product growing in the market. Whereas
in order to give value to the product activities are bifurcated into two parts which are primary
and supportive activities through which business operations are executed and product may react
to its success (Eling and Lehmann, 2018)
.

REFERENCES
Books and journals
Argente, D. and Yeh, C., 2018. Product Life Cycle, Learning, and Nominal Shocks. University of
Chicago mimeo.
Conley, J., 2016. Car troubles: Critical studies of automobility and auto-mobility. Routledge.
Eling, M. and Lehmann, M., 2018. The impact of digitalization on the insurance value chain and
the insurability of risks. The Geneva papers on risk and insurance-issues and
practice. 43(3). pp.359-396.
Godina, R., Rodrigues, E.M., Paterakis, N.G., Erdinc, O. and Catalao, J.P., 2016. Innovative
impact assessment of electric vehicles charging loads on distribution transformers using
real data. Energy Conversion and Management, 120, pp.206-216.
Goldsby, T.J. and Zinn, W., 2016. Technology innovation and new business models: can
logistics and supply chain research accelerate the evolution?. Journal of Business
Logistics. 37(2). pp.80-81.
He, B., Luo, T. and Huang, S., 2019. Product sustainability assessment for product life
cycle. Journal of cleaner production, 206, pp.238-250.
Hernandez, V. and Pedersen, T., 2017. Global value chain configuration: A review and research
agenda. BRQ Business Research Quarterly. 20(2). pp.137-150.
Kranz, M., 2016. Building the internet of things: Implement new business models, disrupt
competitors, transform your industry. John Wiley & Sons.
Matsumoto, M., Masui, K., Fukushige, S. and Kondoh, S. eds., 2017. Sustainability through
innovation in product life cycle design. Springer Singapore.
Silvia, C. and Krause, R.M., 2016. Assessing the impact of policy interventions on the adoption
of plug-in electric vehicles: An agent-based model. Energy Policy, 96, pp.105-118.