Most businesses start as question marks (also known as problem child) They will absorb great amounts of cash if market share remains unchanged (low) Have the potential to become star and eventually Cash Cow, but can also become Dog Must be analyzed carefully in order to determine whether they are worth the investment required to grow market share. Tip: Grow sales by increasing market share. Use cash from Cash Cows to support required investments. Question Mark examples: Apple = Mac Book Air Coca-Cola = FUZE Healthy Infusions Stars High Growth, High Market Share Stars are leaders in business. Require heavy investment to remain its large marketshare. Leads to large amounts of cash consumption and cash generation Attempts should be made to hold the marketshare otherwise the Star will become the next Cash Cow. Tips: Invest for sales growth and market share. Use cash from Cash Cows to support required investments. Star examples: Apple = iPhone Coca-Cola = Vitamin Water Cash Cows Low Growth, High Market Share
Foundation of the company and Stars of yesterday
Generate more cash than required Extract profits by investing as little cash as possible located in an industry that is mature and not growing or declining Tips: Maintain the strong market position and defend your market share. Take advantage of sales volume and leverage the size of operations. Support other businesses. Cash Cow examples: Apple = iPods Coca-Cola = Coca-Cola Classic Dogs Low Growth, Low Market Share Cash traps Do not have potential to bring in much cash Number of dogs in country should be minimalized Business is situated at a declining stage Tips: Optimize your current operations. Get rid of all non value added activities and features. Reposition your offering to generate positive cash flow or sell this business. Dog examples: Apple = Since good company should not have any dogs Coca-Cola = New Coke
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