THE IMPACT OF NEW PRODUCT DEVELOPMENT ON SALES VOLUME
Companies that fail to develop new products are putting themselves at great risk. Risk of poor sales volume, space out of market into a small cubicle of not completely put out by competitors of the same product development strategies, initiatives and innovation conscious that is what that research is aiming to influence on sales volume. The existing products are vulnerable to changing customer needs and tastes, new technologies shortened product life circles and increased domestic and foreign competition once a company has carefully segmented the market, chosen its target customers, identified needs, and determined its market positioning.
It is better able to develop new products. New products development shapes the company’s future. Replacement products must be created to maintain or build sales of the organization.
Every enterprise is profit oriented, that can be actualized through prompt sales volume realize, and that depend on the quality, core products, physical tangible, augmented products and the application of promotional mix/tools of the newly developed product.
It is also clear that customers want new products, and competitors will do their best to supply them. For instance, each year over 16,000 new product (including line extension and new brands are introduced into groceries and drug stores.
In automobile company in general (especially PAN with it uniqueness and distinctive qualitative product) such cannot be less expected.
Automobile company Peugeot in developing a program to reach its intended market, must start with the product (new product) at hand for offering or service designed to satisfy the wants of the market segment. Therefore the executives must plan, develop and manage both individual (industrial users) product and industrial product assortment. This is not easy task as is shown by the large number of product failure in our economy.
1.2 STATEMENT OF GENERAL PROBLEM
Understanding this concept – new product, we discover products or services that are borne of innovation but non existence previously with its present feature so it attracts problems at the level. A new product can be conceived and developed over night, it takes time and efforts to ring the new product idea into fruition. It also consumes a lot of money to bring a new idea generated into commercialized offer.
A new product is expected to be profitable and successful but opposite is the case sometimes to different companies products sometimes decline and die natural deaths due to inexplicable circumstances. Some organizations can tolerate a gradual decay while others adopt alternative actions to remedy the life of the dying product. The reaction of the company leads to new or modified products such products are born out of either innovations or invention that is problem in process.
More so innovations or inventions can be accepted or rejected by the intending customers and this rejection sends the manufacturer back to the drawing board to search for the right product good cost. While acceptance categorizes the intending customers according to the timing of their acceptance and adoption. New product continue to fail a disturbing rate in 1997, record 25, 261 new package goods products were lunched and that doesn’t include products you won’t find at your local supermarket, like technogism and software programmers. But equally stuming is the number that failed. Talking about new product failure in automobile industries, Peugeot 505 evolution (Nigeria innovation/made) was face out 9 years ago.
A twinkle of an eye in the life span of product life cycle of PAN when you consider that it cost N40 million to 90 million to launch a new product you wonder why people continue to innovate at all.
Budgeting for new product development is another problem. Research and development (R and D) outcomes are so uncertain that it is difficult to use normal investment criteria example today 3m innovation network makes more than 60,000 product including sand paper, adhesive, computer diskettes, contact lenses, etc.
And each year 3m launches score of new products. This and 15 billion company immodest goal is to have each of its divisions generate at least 30 percent of sales from product less than four year on the market.
Estimating cost of finding on successful new product considering the process of new product development each.
NO OF IDEAS
COST PER PRODUCT
A new product can emerge due to the preventing circumstances within and outside the company such problems encompass. Organizing new product development the obsolescence of the existing product how to develop and create a new market the company’s strategic objective of product diversification the technological innovation and environmental influence.
1.3 BRIEF HISTORY OF PEUGEOT AUTOMOBILE NIGERIA LIMITED
The name Peugeot is a family name and it happens to a product name too. Before 1975 individuals in Nigeria were importing vehicles into the country.
In 1979 the Federal Government of Nigeria took a firm decision, she decided to import motor vehicle and this continued till August 1970 when the Federal Government invited foreign automobiles companies for a supply and assembly of motor vehicles in the nations, therefore open application form of vehicles were offered. Many automobile companies abroad applied but only Volkswagen of Western Germany and automobile Peugeot of France were favoured and approved by the government. Peugeot is to be sited in Kaduna and in Yaba Lagos. The negotiation and agreement concluded in 1970 and the company Peugeot Automobile Nigerian Limited (PAN) was incorporated the same year.
In 1972 construction commenced in earnest and completed in March 1975 and commercial along that was during the military era. Production started immediately. The first motor vehicle (car) that was produced on that very day was: (i) 405 saloon car along the line are other version. (ii) 504 air conditioned, 504 ambulance, 504 Dagel, 504 SR 2000, 504 special, (ii) 504 delivery van, the best line, new ling, there was no 404 station wagon.
In January 1981, Peugeot 505 was produce, 505 evolution was produced along the line but was faced out for two year ago that year 2000. J5 was developed and introduced in 1991 that was when federal government introduced mass transit. All these mentioned above were the group of first generation of Peugeot products now classify as old generation. The beginning if the new generation includes. Boxer (which has come to replace 15) after that another new Peugeot product was developed, Peugeot 306 model. And so far other versions developed 306 standard, 306 best line, 306 XR, 306 SR, 406 prestige. The other version imported and marketed in Nigeria are 306 station wagon, boxer, 307, 206, the partner and the expert. The 607 and even 708. The partner, boxer and the expert are kit cars not pleasurable car like 306, 406, 607, 206 etc.
1.4 BACKGROUND OF THE SUBJECT MATTER
The subject (new product development) has influence on the issue of sales volume which the researcher would like to unless in assembly and sales of PAN product and services in Nigeria, although the researcher discovered no new products idea generation either from customers.
The company staff, advertising and research agencies, competitors, through conferences, exhibitions, and trade fairs, company’s marketing department and R and D department of the company or through any of the processes to prototype development and test marketing or commercialization in new product development that is ever done or actualized in the assembly nation (Nigeria) rather, but in France, therefore the sales here must be influenced by the cost of raw material source shipped for imported and along with the cost of production in the assembly. This is why sales or marketing strategy apply is more focus on industrial market and government (local state and federal). Majorities and less industrial market (buyer). All that involve are due to the technicalities and uniqueness of the product.
There may be no use attempting to add a new product to the existing range, if such a firm has no clear-cut objectives of what the new product is supposed to achieve. It is not however, within the slope of this research piece make a comprehensive list of the various objectives of new products development as this varied widely from one firm to another.
By and large, the purpose of new product development of an unexplored market potentials which a company has identified. The firm having armed itself life PAN with such objective may then proceed to other steps in new product development.
1.5 RESEARCH SCOPE
This study: impact of new product development on sales volume is the aim of the research to go beyond the elementary understanding the subject at hand. To enlighten the reader and give deep insight or illumination on new product development (NPD), sales in generating and their interaction, relationship impact, connection, influences and enhancement that occurs.
1.6 RATIONALE FOR THE STUDY
Normally a researcher have his aims and objectives for the study but this pieces of work is beyond mere aim for this project, there is a focus/goal and high expectation, and benefits for reader. Not just that alone but to other researcher of this or similar kind, to the company R and D and marketing department and even to the government at large the research work further emphasis on:
a. The need of new product development
b. Objective of new product development programme
c. The constraint and solution project
d. Innovation and adoption categories.
e. Financial and general cost involve
f. Balancing the sales volume while develop more new product frequently.
g. Considering the product life cycle.
1.7 LIMITATIONS OF THE STUDY
Actually, this piece of work ought to be more voluminous that what it is not but due to the inhibiting factors encountered by the researcher during the period which are beyond control.
Inadequate finance brought delay, time wasting and access to total comprehensive information and data hence that is clearly understood or financial crisis is part and Persil of students.
The crash academic program of the researcher couple with lectures combining services with supervising of project all posed problems or threat in its way.
Lack of prompt innovation, invention and initiative ability by company R and D staff and new product failure. Financial deficiency by the company, all the processes of new product development involve money (huge amount). Its never done over night it takes time, labour and money.
Another constraint are sales, new product pass through adoption process or class according to Roggers. It consists of he innovator, adaptors, early majority, late majority and laggards (will consider each later in detail).
In this nature, sales is highly influenced slowly, fast or gradual some times or easily contribute the product declining and out of market when multitudes of late majority and laggards are commonly discovered.
Data provided has a little limitation to its effect hence the secret and organizational policy in some extent must be safe guided and through secured/experienced it at the course of the research.
1.8 DEFINITION OF TERMS
New product of development
Sales volume analysis
NEW PRODUCTS DEVELOPMENT:
Any product which has a new substance incorporated, modified, flavor colour, or even the pack or if its is seen so (new) to consumer in new market or if new uses of it have been discovered.
SALES VOLUME ANALYSIS:
Is a detailed study of the “net sale” section ofTHE IMPACT OF NEW PRODUCT DEVELOPMENT ON SALES VOLUME