At which stage do sales peak and businesses face increased competition due to high profits?

The maturity stage is characterized by peak sales and heightened competition among businesses. At this point in the product life cycle, a product has gained widespread acceptance, and sales have significantly increased. The profits tend to be at their highest because the initial costs of production and marketing have usually been recouped, allowing businesses to enjoy the financial benefits of their investment.

As the market saturates, with many competitors offering similar products, businesses often face intensifying competition. This competition can stem from both new entrants trying to capture market share and existing companies fighting to maintain their customer base. As a result, companies may need to diversify their offerings, enhance customer service, or reduce prices to keep their competitive edge. Understanding this stage is crucial for businesses, as they must strategize how to sustain profitability before potentially moving into the decline phase, where sales and profits typically start to drop.

In contrast, growth involves increasing sales without the saturation and intense competition seen in the maturity stage. Saturation indicates that the market is full, but it is the maturity stage where the peak sales and profits occur. The decline stage usually suggests falling sales and profits, rather than high competition and profitability.