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They say that necessity is the mother of invention. However, starting a product-based business isn’t always about coming up with the best new idea; sometimes, it means improving an existing one. The truth is, you don’t have to reinvent the wheel to create something groundbreaking. And yet studies have shown that 20% of new businesses fail, so you must do everything to ensure the success of yours.
If you are starting a product-based business, congratulations! You are in for an exciting journey. Some sectors appear saturated, but don’t get discouraged. There is always room for innovation. Before you launch, here are some tips to make your product-based business a success.
Business Plans Are Still Important
Let’s say you have an excellent idea for a product. You develop a concept, design it, find a company to manufacture it, and start selling it. You make one million dollars in the first year and become rich. It’s that simple, right? No!
Launching a business may seem simple, but I guarantee it isn’t, and if you think you think you can skip over the essential first step of creating a business plan, you are wildly mistaken. A well thought-out business plan, complete with a mission statement, executive summary, marketing strategy, sales goal, and financial forecast, is the first step of building a successful business.
Numbers don’t lie, and well-forecasted financial statements are essential to any company’s success. Drafting this information may seem like a tedious task; however, you need a plan if you want your business to succeed. Think of your business plan as the roadmap to your success. As you navigate the roads of going to market, it will be your guide to reference every step along the way. Skipping this crucial step leads many start-ups to fail.
Find Your Customer Before You Launch
As you develop your product, you should identify your potential customer. Many small business owners make a big mistake by spending all of their time and energy producing the product—so much so that by the time they’re ready to launch, they have no customers to whom to sell it. Find your target customer and get consumers excited about what you are about to launch. Develop an email list cultivated to find out product preferences and send out offers. Start a social account for your brand while you are in the development stages. Build a community around your brand, and when it’s time to sell, you will already have customers ready to buy.
Marketing and Branding Is Everything
Unless you have invented something groundbreaking that has never been to market before, then your product will have competition, meaning other companies are currently producing similar items. What differentiates your company from the competition? Marketing and your branding. What does your product look like? What is the feel: luxury or affordable? What are the colors you’re using on your website? To capture sales, you must have creative marketing. Additionally, you want your product to speak to its intended audience and make the customer want to buy it. If branding is not your strong suit, hire a firm to handle this for you so you can concentrate on making your product the best it can be.
MOQs Are Your Friend
Three words: minimum order quantity. When you’re starting a product-based business, the last thing you want is to have excess inventory before making sales. As you work with manufacturers, find out their MOQ and see if it’s negotiable. Some believe that ordering a small number of items or inventory will only lead to a small number of sales. Remember, you can always re-order, but if you have too much inventory that isn’t selling, it’ll be tough to get rid of it.
Utilizing a minimum order quantity will allow you to keep more cash on hand and keep your warehouse cost down.
Customer Experience Includes Packaging and Shipping
Think about the last time you ordered something online. When the product arrived, was it wrapped and/or packaged correctly? Did the company use the correct size box? Was it broken? How did the packaging change your opinion about the product or company?
When you’re launching a product business-based business, the product is not your only concern. Every detail can affect your customers’ experience. Think about how you’re shipping your product to the customer and the experience they will have when they open the package. They will form opinions about your company when they go to your website or social media, when they order, when the product arrives and they take it out of the packaging—all before they ever start using your product. Receiving the item is the customers’ last touch-point before they begin using the product, and you only have one chance to make a first impression, so don’t forget this crucial step.
I can’t guarantee the success of your company, but I can tell you that these tips will definitely help you along the way. Best of luck in your launch!