Industries generally pass through a predictable life cycle. In the start-up stage, growth is rapid as a new product begins to permeate the economy, but it is difficult at this point to predict which firms will emerge as industry leaders. As the product becomes established, the industry enters a consolidation stage and industry leaders begin to emerge. In the maturity stage, the product has largely saturated the market, and further growth merely tracks that of the general economy.

Finally, the industry enters a stage of relative decline as it faces competition from new products. P-968