These units typically “break-even”, generating barely enough cash to maintain the business’s market share. Dogs, more charitably called pets, are units with a low market share in a mature, slow-growing industry.Cash “milked” is used to fund stars and question marks, that are expected to become cash cows sometime in the future. They are to be “milked” continuously with as little investment as possible since such investment would be wasted in an industry with low growth. They are regarded as staid and boring, in a “mature” market, yet corporations value owning them due to their cash-generating qualities. These units typically generate cash in excess of the amount of cash needed to maintain the business.
Cash cows are where a company has a high market share in a slow-growing industry. On a 2 x 2 Matrix and, it produces four quadrants which are shown in the infographic below:- Infographic Source : Finnick Originally, the BCG Matrix was made to analyse the product portfolio and to provide a strategy for analysing products according to growth and relative market share.īelow is the original breakdown of the BCG Matrix, according to Wikipedia Therefore, business units that operate in rapid growth industries are cash users and are worth investing in only when they are expected to grow or maintain market share in the future. Market growth rate. High market growth rate means higher earnings and sometimes profits, but it also consumes lots of cash, which is used as an investment to stimulate further growth. Nonetheless, it is worth to note that some firms may experience the same benefits with lower production outputs and lower market share. This is because a firm that produces more benefits from higher economies of scale and experience curve, which results in higher profits. Higher the corporate’s market share, higher the cash returns. Relative market share. One of the dimensions used to evaluate business portfolio is relative market share. It classifies business portfolio into four categories based on industry attractiveness (Market Growth Rate) and competitive position (Relative Market Share). It is a handy business tool which evaluates the strategic position of the business brand/product portfolio and its potential. 
The BCG Matrix or the Growth-Share Matrix is a very popular portfolio planning model which was developed by Bruce Henderson, founder of the Boston Consulting Group (BCG).
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