Life Cycle Assessment in Retail Packaging


The common assertion is that 80-90% of products fail is an “urban legend.”  The empirical literature does not support this popular belief.   No matter how many times it is asserted or how many people believe it, the idea that 80% of products fail is as common as it is wrong.  The actual product failure rate is around 40%.


The development of new products in American can be described by two different approaches:



  • The operations approach. The operations approach is based on internal controls and an internal perspective. Some of these approaches are based on the methods of Lean Manufacturing where the emphasis is on core team design; project planning, specifications, prototyping, performance control and things that can be managed inside the factory.



  • The marketing approach. The marketing approach is focused more on the external influences of new product development such as customer needs, the market, competition, and a realistic sales forecast. The bottom line for this approach is whether enough people can or will buy the new product to justify the investment and the money required to design, build, and test the new product.


In our experience the operations approach can be described as “build it and they will come” or “the mousetrap” theory. It is based on the old assumption that if you build a better mousetrap the world will beat a path to your door. I have to admit, this approach is by far the most popular approach to new products, particularly for small and midsize manufacturers even though the failure rate on new industrial products is still more than 40%.


The approach works well if the cost of the new product is low and the losses can be easily absorbed by the company. On the other hand, if you are building automatic machines and the prototype will cost $400,000 you may not be able to absorb the losses and probably should not take shortcuts.


We would like to make an argument for using the market approach based on the money questions that need to be answered. New product development is an investment and may require a significant amount of capital to be successful. These are decisions with considerable risk and every effort should be made to do a careful evaluation of the money decisions at each step of the process.










New product development begs a lot of money questions such as:


  1. How much will the total project cost?
  2. What price will users pay for this product?
  3. Is the sell price comparable to competitor prices?


So, to survive as an independent or large big-box retail store, you know you must lure customers away from the competition. You have roughly 12 seconds to catch the customer’s attention and get them to make a decision to purchase your product over a similar one sitting six inches away. Creative offerings help you do just that. As your business ages, however, it’s easy to settle into a routine and lose some of your innovative edge. Thinking about your business in terms of life cycle stages can help you avoid ruts to remain in your customers’ hearts and minds.


Introduction Stage

As the name implies, the introduction is the beginning stage of any business, characterized by innovation and industry expansion. Entrepreneurs in this phase of development either introduce a new retail store model, for example a particular product mix combined with a new service, or a new direction for an existing store. Introductory stage stores should be prepared for low profits due to high development costs. Retail experts often state that any failing retail business can revert back to this introductory stage of development and strategy.


Growth Phase

Once your store catches on, it enters the growth phase. As you grow, your profits increase and customers will rave about your brand. While this phase may feel like Christmas. This is a delicate time in growth as competitors will start noticing and ultimately begin to copy your brand that may dilute and remove some of that competitive edge.   The challenge in this stage is to keep innovating enough so you have something new and exciting for your customers each time they visit. Otherwise, you revert back to the introductory stage as you reinvent the wheel that only allows the competition to continually profit off your innovative products. Ensuring that you work with highly reputable firms for sourcing your product is key. Without the proper Non-disclosure agreements (NDAs) and protection you are leaving your company open to loss of market share and profits.







Maturity Phase

Once you are fully established, you should have a rhythm where you’ve gotten pretty good at keeping the store stocked, so customers can count on you.


In this stage, you also have a lot of competition and your store defines your industry instead of feeling new and different.


Competition may even increase to the point where your industry over expands, leading to declining profits and reduced customer loyalty.  As this happens, prices begin to drop as you and your competitors try to lure back customers with great deals. To counter this, e3 image group advises innovation instead of discounting. Your brand shown through your packaging on the shelf.






If you are unable to innovate sufficiently to keep your business new and fresh, it enters the last phase of the retail life cycle… decline. At this point, your business may seem out of date and boring to customers. Other retailers have probably caught their attention, and it’s difficult to lure those customers back. Successful businesses watch the trends in their industry and neighborhood to anticipate the decline and change before customers abandon them.  The biggest brands have subtle changes in their packaging that continues to retain and grow their market shares.


Don’t sit around and be reactive in nature with your product. Once you have a proven method of success in the retail market this is just the beginning. Without a path of innovation any product will eventually wilt away unless constant nurturing takes place.


Stay in tune with customers, buyers, and your competition to understand advancements that are necessary in growth opportunities. Trust a professional package engineering firm to ensure the results you need are obtained through creative marketing, design, and consulting. If major retail channels are your goal you will get one chance to get it right. Getting into the store and having the product perform at the level expected is different.


If box store A orders 500 units for 100 stores with an expected sell through rate of 30 days, and 45 days later you have more than 10% remaining most buyers may revert to taking your product off the shelf, disposing of the product, and invoicing you in return for the remainder of products left in store.


E3 image group consults, engineers, and handles all aspects of the retail packaging cycle to ensure you are successful. We know the pitfalls and can steer you away, over, or through all of them. From concept through fulfillment e3 has the solution.

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