Don’t Let Manufacturing Companies Break the Bank

By Florence Adrian 12th Jan, 2021

Your product has gone through the full development process, and you have all your marketing materials ready. Now you can finally sit back and relax watching while your message conquers the world, right?  We are going to disappoint you, the real journey is yet to begin and for it to be a smooth one, you need to know how to avoid the scenario in which manufacturing companies break the bank and take you to bankruptcy, or near it. Luckily for you, we’ve asked the experts some important questions. 

Follow the Rules

A lot of people can make a product that is 70% ready, but to develop a product that is 100% ready for the manufacturing companies and the market is not an easy thing, it takes skill and know-how. Some rules need to be followed. Everything you do before the launch is preparation and we are not saying it hasn’t been hard work to get there, but the road doesn’t end there. It is where your true entrepreneurial story begins.

 

1. Start Small 

Being able to talk to your customers is a priceless resource in making your product better. This makes retail shops a perfect place to start. The owners of these shops are intimate with their customers, and they can tell you everything the customers share about your product. 

“The best thing to do is to start small so that you know that people want your product. Let the big box stores come to you as opposed to you going to them.” — Mark Sousa, COO of Product Development at IdeaPros

The problem with the big-box stores is that they are BIG. Well, that maybe isn’t a problem for them, but it could be for you. You would have to provide large quantities of your product from the manufacturing companies. They will give you a hard date to deliver them. If anything goes wrong and you don’t make it on the agreed date, you will be charged for every day that you are not on the shelf. Once you get the product on the shelves, you have a 6-week window to meet the expectations.  If your product doesn’t perform, they will discount the price. They will give you a bit more time, and if it is not working, they will ask you to buy the product back. Meaning that you will buy the product from the factory and then buy it back from the big-box stores, therefore, paying the shipping twice. 

 

2. Use Home Use Test (HOT)

Home use test is a part of the pilot run where you create the first 250 pieces from the manufacturing companies. You give it to the customers you have identified that want your product. You don’t give it to your family and friends, you give it to the interested customers together with a survey and ask what they don’t like about it.

“In this phase, you work out the kinks because you can only launch your product for the first time once. You want to be sure that it is exceeding the expectations.” — Mark Sousa 

When we say kinks, we are not referring to the color and similar things because everyone is going to have an opinion on that. Don’t be afraid to ask difficult questions because they will help you find out where the roadblocks are. It is better to hear it from 250 customers than from an online review:

  • Did it do what it was supposed to do? If not, why?
  • Did it meet your expectations? If not, why?

“You want to see where the issues are and you want to do that in every single step of the process, and that doesn’t end when you get to manufacturing.” — Fred Cary, CEO of IdeaPros

 

3. Make an Incredible First Impression

If your product is not 100% ready for the market, you will not only have to make lots of returns, you’ll lose the money you paid the manufacturing companies too. You will also lose all the customers that were interested in the first place. Once you disappoint them, they won’t come back next season when you relaunch. So take your time and do it right. Don’t look at the clock or the calendar, look at your product, and determine whether it’s ready to go live or not. You only get to make a first impression once.

“There’s a commonality in every single step of the way and that is to know what you’re doing.” — Fred Cary

If you ever feel that you don’t know what you’re doing, feel free to contact us, and we will be happy to show you the way.

The “Idea Pros” at IdeaPros have the resources, experience, and tools to help you at this step or any step in the entrepreneurial journey.

We partner with entrepreneurs at any stage and who are ready to invest their ideas. Apply for an interview and let’s explore partnering together.

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Want to see the products we have launched?  Check out the IdeaPros Launchpad!