During which stage might a business cut prices to clear out remaining stock?

A business typically cuts prices to clear out remaining stock during the decline stage of a product's life cycle. At this point, sales have begun to fall as consumer interest wanes, possibly due to new competing products or changing market preferences. Cutting prices is a strategy used to stimulate demand and move excess inventory before the product is phased out completely.

In the decline stage, businesses aim to maintain cash flow and reduce storage costs by offering discounts to encourage sales. This is a tactic to liquidate stock, allowing the firm to reallocate resources to more profitable areas or new product development.

Understanding the decline phase helps businesses strategize effectively to manage their inventory and optimize their overall financial health.