Starting a new business is never easy. And if you’re basing that business on a certain product, you have to make sure you do the legwork and research to ensure no one else has come up with that product, and to make sure there’s a demand for what you’re selling.
Think you’ve got a great idea for a product?
Here are 10 tips for starting a product business, from Dr. Tamara Monosoff, founder & CEO of Mom Invented & Mom Invented Approved Brand of Products, and author of four business books, including The Mom Inventors Handbook: How to Turn Your Great Idea into the Next Big Thing.
1. Take a stand for yourself
If you are dissatisfied with your current circumstances, no one will fix them – except for you. It doesn’t do any good to blame the economy, your boss, spouse or family. Change can only occur when you make a conscious decision to make it happen.
2. Hold onto your money and gain knowledge FIRST!
Save countless hours and money by investing in yourself. Learn about the inventing process first before you spend a penny.
3. Set realistic expectations
Successful inventing is about developing a product and taking it to market. View your product as a business from the very beginning. It can, and should be profitable and gratifying. However, it is not an easy, get-rich-quick scheme.
4. Search everywhere to see if your product already exists
Make sure that you look extensively in the marketplace before you spend money developing your product (Internet, small, mid-size & big-box stores). Tip: use a thesaurus to find other words to describe your product. This will help expand and deepen your search.
a. Before you spend money, find out if people will actually buy your products or services first. This may be the most important thing you do! You can do this by validating your market. In other words, who EXACTLY will buy your products or services other than your family or friends? (And don’t say… “Everyone in America will want my product.” Trust me. They won’t). What is the size of your target market? Who are your customers? Is your product or service relevant to their everyday life? Why do they need it?
b. There is industry research that you can uncover for free. Read industry articles with data (Google the relevant industry associations) and read Census data to learn more. However, the most important way to get this information is to ask your target market directly and then LISTEN.
6. Don’t wait for a patent (getting a patent is not a requirement!)
A patent can be a useful tool but it is not required. Even if you choose to file a patent, there are many steps to be taken first. The absence of a patent should NOT be a hindrance from making progress. Just make sure that you are not infringing on someone else’s patent. Visit the US Patent and Trademark Office Web site to find out more about the patent process.
7. Make a prototype
Creating a prototype is a fun and creative process. The purpose of a prototype is to test the functionality of the product. Start out by using household items. If your product is complex, hire a handyman, a student studying Industrial Design, or a machinist. If you need an engineer, be prepared with sketches and a rudimentary prototype in hand so that you can communicate effectively to save time and money. Then find a great manufacturing partner that you can trust.
8. All money is not equal
Understand your personal finances and then choose the “right” kind of money you need for your business.
a. As an entrepreneur, your personal life and business life are interconnected. You are likely to be your first, and possibly, only investor. Therefore, having a detailed understanding, and ability to track your personal finances, is an essential first step before seeking outside funding for your business. This is why I recommend setting up your personal accounts on Mint.com to simplify this process.
b. As you are creating your business plan you will need to consider what type of business you are building – a lifestyle business (smaller amount of startup funds), a franchise (moderate investment depending on the franchise), or a high-tech business (will require significant capital investment). Depending on where you fall on the continuum, you will need a different amount of money to launch and grow your business and it does matter what kind of money you accept. (Resources mentioned in detail in Chapter 4 of Your Million Dollar Dream: Take Control & Be Your Own Boss are: peer-to-peer lending, grants, angel groups, bank loans, and information about venture capital groups.)
Related: Entrepreneurs — Quit Your Startup
9. Create your plan!
Most people don’t plan BUT it will help you get to market faster. A business plan will help you gain clarity, focus, and confidence. A plan does not need to be more than one page; and, as you write down your goals, strategies and action steps – your business becomes REAL.
Ask yourself the following questions:
a. What am I building?
b. Who am I in service of?
c. What is the promise I am making to my customers/clients and to myself?
d. What are my objectives, strategies and action plans (steps) to achieve my goals?
10. Get the word out!
Embrace and use the most effective online tools (Twitter, Facebook, YouTube and LinkedIn) available to broadcast your news. You must use them but don’t underestimate the power of other methods to get the word out: word-of-mouth marketing, website and Internet marketing tools, public relations, blog posts, columns and articles, speeches, email, newsletters, and the old-fashioned, but still essential … telephone!
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