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Portfolio matrix

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    Portfolio matrix Portfolio matrix Presentation Transcript

    • PORTFOLIO ANALYSIS - By Prof. Purvish Shah BE ( Mech), PGDBM (Gold Medalist)
      • Product Life Cycle: It is a life span through which a product needs to move.
      Low brand loyalty sales is target Building awareness Promotion Selective new channels More intensive Selective Distribution Low price reduction Based on demand High/Low Price Reduced differentiation important More product/More features Few products Product Decline Maturity Growth Introduction  
      • Portfolio Matrix : Popularly known as BCG matrix
      • Developed based on product life cycle theory
      • by Boston Consulting Group.
      • What are the priorities for a company in given product portfolios
      • Helpful in long term value creations for a company
    • Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs Cash Cow ? ? ? STAR
      • Dogs:
      • Low market share
      • Low Growth rate
      • Cash trap for companies
      • Question Marks:
      • Fast growing
      • Consumes major cash
      • Either become Dog or Star ( high risk)
      • Stars:
      • Generate Cash
      • High cash consumption
      • If taken care becomes Cash cow
      • Cash Cow:
      • Generate more cash than consume
      • Help other business grow
      • BCG matrix for ITC ltd.
      • ITC is formally known as Indian Tobacco company.
      • Company is in to diverse business portfolio like Hotels, Greetings, Cigarettes, Agarbatti, Specialty papers, Agricultural business, Cloths, Sports wear, FMCG products and Infotech business .
    • Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs Infotech Cash Cow Cigarettes, FMCG ? ? ? Agarbatti, Cloths STAR Hotels, papers, Agri business
    • BCG matrix for MARUTI SUZUKI Models available: Swift, Zen estillo, Swift Desire, sx4, grand vitara, A STAR, ALTO, 800, Wagon R, Versa, Baleno, Omni
    • Low Low High High Market Growth Rate Relative Market Share Cash Usage Cash Generation Dogs BALENO, VERSA, OMNI Cash Cow 800, ALTO, WAGON R ? ? ? SX4, GRAND VITARA, A STAR STAR SWIFT, ZEN ESTILO, DESIRE
      • LIMITATIONS:
      • Only two factors taken in to consideration.
      • Data accuracy becomes very important
      • Business of low over all market share may also be profitable ( specialty/niche segments)
      • It ignores effect of synergy between different business.